SPOKANE Agenda Sheet for City Council Me,sting of' 8Date Rec'd @6/1612011 ]I~ O/0fil2712011 ::I Cieri< use only)

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Interloc~l Agreement regarding annexation of portions of the West Plains Urban .:..Growth Area between the city of Spokane, Spokane County, and Spokane countyFire Protection District No. 3.

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The City is pursuing annexation of 9.6 square miles within the West Plains .:.Urban Growth Area pursuant RCW 35.13.238, the Interlocal Agreement Method ofAnnexation of Area Served by Fire Districts. The City of Spokane, SpokaneCounty FLr:e Protection District No. 3 and Spokane County have completednegotiations on the required Interlocal Agreement necessary to move forwardwith the West Plains Annexation.

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Legal IRICHMAN, JAMES Ilsdecker@SPOkaneCity.org IFor the Mayor IFEIST, MARLENE Iltdanek@spokan~City.org

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Continuation of Wording, Summary, and Distribution

Agen~a Item NaJne: I0370-WEST PLANS ANNEXATION FIRE DIST 3

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Summ!l'Y (Backgrou_nd} ~487 character max)Ratification of this agreement and a similar agreement with the County and ..:JSpokane County Fire Protection District No. 10 will allow the City tosUbsequently file a Notice of Intention to Annex with the Boundary ReviewBoard and place an annexation ordinance on the COUIICil agenda. The unticipatedeffective date of annexation for the West Plains Annexation area is January 1,2012.

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Return to: City of SpokaneAttn: Clerk808 W Spokane Falls BlvdSpokane,WA 99201

INTERLOCAL AGREEMENT REGARDING ANNEXATIONSOF PORTIONS OF THE WEST PLAINS URBAN GROWTH AREABETWEEN THE CITY OF SPOKANE, SPOKANE COUNTY, AND

SPOKANE COUNTY FIRE PROTECTION DISTRICT NO.3~ (0)\ -05t,3 /1- Ol,,! /

THIS AGREEMENT, made and entered into this ::2.g day of :I1+ IV £. ,20_1_' (the "Effective Date") by and between the City of Spokane, a Washingtonmunicipal corporation, hereinafter "City", Spokane County Fire Protection District No.3,a municipal corporation, hereinafter "District," and Spokane County, a political subdivisionof the State of Washington, hereinafter "County", jointly hereinafter referred to as the"parties."

WIT N E SSE T H:

WHEREAS, Washington's legislature, pursuant to Engrossed Substitute Senate Bill5808 (codified in RCW 35.13.238), and consistent with the regional cooperationenvisioned and anticipated as a result of implementation of the Growth Management Act,Chapter 36.70A RCW ("GMA"), has authorized a new method of annexation referred to asthe interlocal method of annexation ("Interlocal Method of Annexation"); and

WHEREAS, following consultation with the District, the City and the County,together With the City of Airway Heights, previously entered into an agreement titled"Interlocal Agreement Regarding Annexations of Portions of the West Plains UrbanGrowth Area Between the City of Spokane, the City of Airway Heights, and SpokaneCounty" (hereinafter the "Interlocal"), a copy of which is attached hereto as Exhibit A andthe terms of which are incorporated into this Agreement; and

WHEREAS, the Interlocal contemplates the parties to this Agreement providing forannexation by the City of an area within the West Plains Annexation Area, as shown in

Page 1 of 14

Exhibit B, hereinafter the "Annexation Area," pursuant to the Interlocal Method ofAnnexation; and

WHEREAS, as contemplated in the Interlocal, and in the spirit of regionalcooperation and leadership, the parties have elected to provide for the City's annexation ofthe Annexation Area pursuant to the Interlocal Method of Annexation; and

WHEREAS, the City and the District previously entered into an agreement titled"Interlocal Agreement Between the City of Spokane and Spokane County Fire ProtectionDistrict No. 3 Concerning Impacts of Annexation", dated May 10, 2010, relating toannexations by the City of unincorporated areas served by the District ("AnnexationMitigation Agreement"), a copy of which is attached and incorporated herein as Exhibit C;and

NOW, THEREFORE, in consideration of the facts, recitals, and commitments setforth in the Interlocal and this Agreement, which the parties mutually agree constitute goodand adequate consideration for the obligations of the parties set forth herein, the partieshereby agree as follows:

SECTION NO.1: PURPOSE

The purpose of this Agreement is to set forth certain agreements between the partiesrelating to the City's annexation of the Annexation Area, as described in Exhibit B (the"Annexation").

SECTION NO.2: APPLICABILITY OF THIS AGREEMENT

The parties agree that the provisions of this Agreement shall apply to the Annexation.

SECTION NO.3: STATEMENT OF GOALS

3.1 Transfer of revenues and assets between the District and the City. Thetransfer of revenues and assets between the District and the City shall be governed by theAnnexation Mitigation Agreement, attached and incorporated herein as Exhibit C.

3.2 Level of Service. The City represents that the Annexation will enhance thefire protection and emergency medical service levels of service both within the AnnexationArea and within those areas of the District lying outside of the Annexation Area. TheDistrict and the City have entered into the Annexation Mitigation Agreement, Exhibit Cwhich is intended to mitigate and prevent any negative impacts on the level of servicewithin the Annexation Area and within those areas of the District lying outside of theAnnexation area. The parties recognize that the annexation may have a negative impacton the District's insurance rating as established by the Washington State Surveying andRating Bureau "WSSRB". The City agrees to cooperate and work with the District and theWSSRB to minimize any negative impacts to the insurance rating.Page 2 of 14

3.3 Division of assets and its impact on citizens inside and outside theAnnexation Area. The City and the District agree that there will be no division of assetsand no resulting impact on citizens living inside and/or outside of the Annexation Area.

3.4 Agreed upon schedule of public meetings within the Annexation Area forcommunity involvement.

Two West Plains Informational Meetings on Cooperative Annexation Plans were held atthe Hilton Gardens Inn located within the Annexation Area at 9015 W. State Route 2:

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6/3/2009, 6:30 PM to 8:00 PM Hosted by County Commissioner BonnieMager, City of Airway Heights Mayor Matthew Peterson, and City ofSpokane Mayor Mary Verner, and8/19/2009, 6:30 PM to 8:00 PM Hosted by County Commissioner ToddMielke, City of Airway Heights Mayor Matthew Peterson, and City ofSpokane Mayor Mary Verner.

In furtherance of this Agreement, the City will hold a public hearing on the Ordinanceauthorizing the annexation before the City of Spokane City Council at a time and date setforth in the City's official newspaper and website - www.spokanecity.org. The City willfurther make available, through the City Clerk, documents and information that relates tothe annexation of the Spokane Annexation Area.

3.5 Revenue sharing, if any.

3.5.1 District. Revenue sharing between the District and the City shall begoverned by the Annexation Mitigation Agreement, attached and incorporated herein asExhibit C.

3.5.2 County. In lieu of any type of annexation mitigation/revenue sharingbetween the City and County, the City agreed to postpone the Effective Date of theAnnexation until January 1,2012.

3.6 Debt distribution. There is no distribution or assumption of debt by oramongst the parties.

3.7 Capital facilities obligations of the City and District. EThe capital facilitiesobligations of the District and the City shall be governed by the Annexation MitigationAgreement, attached and incorporated herein as Exhibit C. The District shall continue tohave access to and the use of fire hydrants located within the Annexation Area and inareas immediately adjoining the Annexation Area so long as the Annexation MitigationAgreement, Exhibit C, remains in effect. The District shall document the address of thehydrants used, the date of use and the estimated amount of water used and shall providesuch documentation to the City of Spokane Water Department on a monthly basis.Page 3 of 14

3.8 Schedule or plan on the timing of the Annexation. The parties agree that theAnnexation will have an effective date of January 1, 2012 (the "Effective Date ofAnnexation"). In the event there is any challenge which stays the effective date of theAnnexation, the Effective Date of Annexation shall be extended until the stay is lifted.

3.9 The City's development regulations. Upon the Effective Date of Annexation,the City's Comprehensive Plan and implementing development regulations, as set forth inthe Spokane Municipal Code, shall apply and be enforced within the Annexation Area.

SECTION NO.4: JOINT PLANNING

4.1 Continued maintenance of infrastructure. The County shall continue toperform routine maintenance of County infrastructure, including streets, sewers, water,storm water, and similar public facilities within the Annexation Area until the Effective Date,as extended pursuant to Section 3.8 herein above.

4.2 Tax increment financing. The County shall obtain the written approval of theCity, which the City may withhold for any reason, prior to creating any new or additional taxincrement financing areas within the Annexation Area or any similar measures that resultin the diversion of property and/or sales and use tax to finance public improvements.

4.3 Comprehensive Plan Amendments - Development Review.

4.3.1 Land Use Changes. The County shall not amend any use and/orzoning designations for properties within the boundaries of the Annexation Area withoutfirst providing written notice to the City and giving due consideration to written and verbalcomments submitted timely by the City. Nor shall the County approve any textamendments to its comprehensive plan or related development regulations that wouldhave the effect of allowing a change of use of property within the boundaries of theAnnexation Area without first providing written notice to the City and giving dueconsideration to written and verbal comments timely submitted by the City.

4.3.2 Development Review Within Pending Annexation Area. The Countyshall process to completion any development for which it received a complete permitapplication and accompanying fee prior to the Effective Date of Annexation, except whenearly transfer of authority occurs as described in Subsection 4.3.5 below. "Completion"shall mean final administrative approvals and certifications to include extensions of time inthe case of subdivisions, except in the case of legislative actions; in which case decisionswill be made by the Board of County Commissioners or transferred to the City Council ifannexation has occurred. Where the County continues to have jurisdiction, the County willconfer with the City on all development review decisions affecting the pending AnnexationArea.

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4.3.3 BUilding Permits. Except when early transfer of authority occurs

as described in Subsection 4.3.5 below, building, plumbing, mechanical, fuel gasresidential, energy, and/or fire code permits issued by the County shall be processed bythe County through final inspection and/or certificate of occupancy. Commercial buildingand residential permit applications, to include ancillary permits Le. mechanical, plumbing,fire alarm, sprinkler, etc., such as where plan review fees have been paid shall beprocessed by the County through permit issuance, final inspection, and certificate ofoccupancy. The final inspection may be a joint City/County inspection, with the City beingafforded the opportunity to be in attendance for information purposes. After the effectivedate of the annexation, the City and County may meet from time to time to review thestatus of all active projects in the annexation area remaining under review by the Countyand determine whether or not responsibility for continued processing should be transferredto the City. Any requested renewals of such applications shall be made to andadministered by the City.

4.3.4 Code Enforcement. Upon request, the County will provide the Citywith information regarding any properties which are subject to pending County codeenforcement action.

4.3.5 Early Transfer of Authority Authorized. It is the intent of the City andCounty to facilitate timely processing of development applications for properties that arelocated within the boundaries of the Annexation Area. When a property owner agrees, theCounty will, in writing, transfer review, permit-processing, and decision authority to theCity for projects submitted prior to annexation. If annexation proceedings are delayed tosuch a degree that it is probable that development review would be completed prior tocompletion of the annexation, the City will return review and processing authority to theCounty to ensure continuous processing of development applications

4.4 Outstanding bonds and special or improvement district assessments. Anyoutstanding bonds by any of the parties will be due and payable by the issuer party.Special assessments remain the responsibility of the property owner.

4.5 Annexation procedures.

4.5.1 Boundary Review Board. Any time after the Effective Date of thisAgreement, the City may file a notice of intention with the Spokane County BoundaryReview Board ("BRB") indicating the City's intention to complete the Annexation. Theparties acknowledge and agree that the jurisdiction of the BRB may not be invoked asdescribed in RCW 36.93.100 for the Annexation described in this Agreement.

4.5.2 Notification of employees. No later than 30 days after the EffectiveDate of this Agreement, the City and the District shall jointly inform District employeesabout hires, separations, terminations, and any other changes in employment that are adirect consequence of the Annexation, if any.

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4.5.3 Ordinance. After providing the notices required in Sections 4.5.1 and4.5.2 herein above, the City will adopt an ordinance annexing the Annexation Area. Theordinance shall make the Annexation effective on January 1, 2012.

4.5.4 Duty of Mutual Cooperation. None of the parties will attempt toinvoke the jurisdiction of the BRB with respect to the Annexation. None of the partiesshall commence or maintain any action of any kind in any forum challenging theAnnexation.

4.6 Consultation with other service providers, including water-sewer districts. ifapplicable. See Section NO.5 below.

4.7 Financial and Administrative Services. Each party shall be responsible forits own financial and administrative services, except as otherwise set forth in the FireServices Agreement.

SECTION NO.5: PROVISION OF SERVICES

Upon the Effective Date of Annexation, the City will provide a full range of urbangovernmental services to the Annexation Area ..

SECTION NO.6: DURATION OF AGREEMENT

This Agreement shall be in effect for a period of five (5) years commencing on theEffective Date and terminating at midnight five years after the Effective Date. unlessextended by mutual written agreement of the parties. The Duration of the AnnexationMitigation Agreement, Exhibit C shall be as defined in that document and shall not becontrolled or affected by the Duration of this Agreement.

SECTION NO.7: ADMINISTRATION

The City hereby designates its City Administrator as its representative for the purpose ofimplementing this Agreement. The District hereby designates its Fire Chief as itsrepresentative for the purpose of implementing this Agreement. The County herebydesignates Chairperson of the Board of County Commissioners as its representative forpurposes of implementing this Agreement.

SECTION NO.8: DISPUTE RESOLUTION

MEDIATION AND ARBITRATION. If any party has a claim or dispute under thisAgreement, notice of the same shall be sent to the other party. The notice shall provide abrief description of the dispute.

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Mediation. If the parties are unable to resolve the dispute within ten (10) business days,the parties shall engage a mediator to assist the parties in resolving the dispute. Themediator's fees and costs shall be equally shared by the parties.

Arbitration. If the parties cannot resolve their dispute through mediation, the exclusiveremedy is binding arbitration in accordance with the JAMS Arbitration Rules or by anAlternate Dispute Resolution Process that can be mutually agreed upon. The arbitrator'sfees and costs shall be equally shared. The arbitrator's decision shall be final, binding onthe parties and enforceable pursuant to RCW Chapter 7.04A. The prevailing party shallbe entitled to payment of its attorney fees and costs.

For purposes of this Section 8, the terminology "parties" shall refer only to those partiesactually involved in the dispute. Any party not involved in the dispute shall not beconsidered as one of the "parties".

SECTION NO. 9: DEFAULT

The occurrence of anyone or more of the following events shall be an "Event of Default"under this Agreement:

Failure by the City, the District, or the County to perform, observe, or comply with thecovenants, agreements, or conditions on its part contained in this Agreement, where thatfailure continues for a period of thirty (30) days after written notice from the non-defaultingparty; or

SECTION NO. 10: REMEDIES

Following an Event of Default, any party may commence the Dispute Resolution processset forth in Section 8.

SECTION NO. 11: NOTICE

All notices shall be in writing and served on any of the parties either personally or bycertified mail, return receipt requested, to the persons below designated as contactpersons. Notices sent by certified mail shall be deemed served when deposited in theUnited State mail, postage prepaid.

CITY: City Administrator or his/her authorized representative808 West Spokane Falls BlvdSpokane, Washington 99201

DISTRICT:

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COUNTY: Chairperson, Board of County CommissionersW. 1116 BroadwaySpokane, Washington 99260

SECTION NO, 12: AGREEMENT TO BE FILED

The County shall file this Agreement with the County Auditor or place the Agreement onthe County's web site. The City shall file this Agreement with its City Clerk. The Districtshall file this Agreement with the Secretary to the Board of Commissioners of theDistrict.

SECTION NO, 13: COMPLIANCE WITH LAWS

The parties shall observe all applicable federal, state and local laws, ordinances andregulations in conjunction with meeting their respective obligations under the terms ofthis Agreement.

SECTION NO, 14: VENUE STIPULATION

The laws of the State of Washington shall be applicable to the construction andenforcement of this Agreement. Any action at law, suit in equity or judicial proceedingregarding this Agreement shall be instituted only in courts of competent jurisdictionwithin Spokane County, Washington.

SECTION NO, 15: MODIFICATION

No modification or amendment of this Agreement shall be valid until the same isreduced to writing and executed with the same formalities as this present Agreement.

SECTION NO, 16: WAIVER

No officer, employee, agent or otherwise of any party has the power, right or authority towaive any of the conditions or provisions of this Agreement. No waiver of any breach ofthis Agreement shall be held to be a waiver of any other or subsequent breach. Allremedies afforded in this Agreement or at law shall be taken and construed as cumulative,that is, in addition to every other remedy provided herein or by law.

SECTION NO, 17: ALL WRITINGS CONTAINED HEREIN

This Agreement contains all the terms and conditions agreed upon by the parties. Noother understandings, oral or otherwise, regarding the subject matter of this Agreementshall be deemed to exist or to bind the parties. The parties have read and understand allof this Agreement, and now state that no representation, promise or agreement notexpressed in this Agreement has been made to induce any of them to execute it.

Page 8 of 14

SECTION NO. 18: HEADINGS

The section headings in this Agreement have been inserted solely for the purpose ofconvenience and ready reference. In no way do they purport to, and shall not be deemedto, define, limit or extend the scope or intent of the sections to which they pertain.

SECTION NO. 19: SEVERABILITY

In the event any portion of this Agreement should become invalid, or otherwiseunenforceable, the rest of this Agreement shall remain in full force and effect.

SECTION NO. 20: BINDING EFFECT

The parties warrant that they have the full power and authority to execute and deliver thisAgreement and to perform their respective obligations under this Agreement. ThisAgreement constitutes a valid and legally binding obligation of the parties and isenforceable in accordance with its provisions.

SECTION NO. 21: TIME IS OF THE ESSENCE

Time is of the essence of this Agreement.

SECTION NO. 22: RCW 39.34 REQUIRED CLAUSES.

A. PURPOSE.

See Section No 1 above.

B. DURATION.

See Section NO.6 above.

C. ORGANIZATION OF SEPARATE ENTITY AND ITS POWERS.

No separate legal entity is necessary in conjunction with this Agreement.

D. RESPONSIBILITIES OF THE PARTIES.

See provisions above.

E. AGREEMENT TO BE FILED.

See Section No. 12 above.

F. FINANCING.Page 9 of 14

See Section NO.3 above.

G. TERMINATION.

See Section NO.6 above.

H. PROPERTY UPON TERMINATION.

Title to all property acquired by any party in the performance of this Agreementshall remain with the acquiring party upon termination of the Agreement.

SECTION NO. 23: NO THIRD PARTY BENEFICIARIES

Nothing in this Agreement is intended to give, or shall give, whether directly or indirectly,any benefit or right, greater than that enjoyed by the general public, to third persons.

SECTION NO. 24: SURVIVAL

Any Sections of this Agreement which by their sense and context are intended tosurvive shall survive any termination, expiration or determination of invalidity in whole orin part. The Annexation Mitigation Agreement, Exhibit C shall survive termination of thisAgreement.

SECTION NO. 25: COUNTERPARTS

This Agreement may be executed in any number of counterparts, each of which, whenso executed and delivered, shall be an original, but such counterparts shall togetherconstitute but one and the same.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executedon date and year opposite their respective signatures.

DATED: ~~~»;q~ZO~I_\ _

CITY OF SPOKANE

BY:~=xL~__Its: ~~.loLIlk~,.u..fr: _

City AdministratorApproved as ft5Yf~~kane

kam~

City Clerk Assistant City Attorney

SPOKANE COUNTY FIREPROTECTION DISTRICT NO.3

Attest: Chair

Q~A..c ;j ~lL-ODistrict Secretary

MARK RICHARD, Commisslo r

BOARD OF COUNTY COMMISSIONERSOF SPO NE CO NTY, WASHIN ON

Attest:

~~anlela EricksonClerk of the Board

Page 11 of 14

Exhibit A

Interlocal Agreement Regarding Annexations of Portions of the West Plains Urban GrowthArea Between the City of Spokane. the City of Airway Heights, and Spokane County

Page 12 of 14

uh~ .)] RECEJ \tE.-:~14.2007• AGENDA SlEET FII eOINOll MEnlNG IF: NIVDmIl8r,16,2009 ... ~ov 05 2f){J9 sPOKAN'E

Submitting Dept. Contact Person/Phone No. ~~Sddii_ ~ u ._.Public Works H. Delaney/J .Rlchman 625-6225 .. PrJl(ANF.. ~tll,;E

IIMIlIlllATIVE PilI 1l111.lTIVE lESS"" CRY '111m- Contract 0 Emergency Oro 0 Communications CLERK'S FILE 0P62 c)2OO~ -09(. ,o Report 0 Resolution - Economic Development RENeWSo Clafms 0 Final Reading Ord 0 Growth Management CROSS REF

,....::;===-=:===~ 0 First Reading Oro 0 HumlillO Services eNGSTANDING COMMITTEES 0 Special Conslcleratlon e Neighborhoods BID

(Date of Notification) 0 Hearlrl 0 Public Safety REQUISITIONo Finance 0 Public Safety 0 Quality Service Delivery r-:Ne~·."i!-ig~hb~Orh¥.OOdICom~::::--~m-:-laI""!'lo-·nJCom~.-m"!!'lt'!"'tee~NotIfled~·'!'I::'"''':'''':~oNelghborhoods 0 Public Works 0 Racial Equity/Cultural Diversityo Plan uni & ECOf1 De" 0 RebulldlMaintaln Infrastructure L.:A~c=tio:::.:n~r.:;::.ak:.:;lln:.::.; --.I

AlERIAWIRIIN8:

nCIIIIINI:(Attach llddltlonalsheet if necessary)

INTERlOCALAGREEMENT REGARDING ANNEXATIONS OF PORTIONS OF THEWEST PLAINS URBAN GROWTH AREA BETWEEN THE CITY OF SPOKANE, THECITY OF AIRWAY HEIGHTS, AND SPOKANE COUNTY

The cities of Spokane and Airway Heights have previously entered into a Memorandumof Understanding which anticipates the cities entering into a subsequent lnterlocalagreement providing for annexations by the cities within the West Plains Urban Growt hArea. Spokane County also joined the cities' negotiations and the three entities haveagreed on an approach for annexations by the cities within specified areas of the WestPlains Urban Growth Area.

REel.MENI.DON: Approve. ...R_S,=CII,;;;;",;;;;"-;:"~C;;;.;;I:::....:-._N_/A ~""~II....III...Ano=-=_=-·_o_Nl_'A --to Expenditure: $ #o Revenue: $ #o Budget Neutral

Amea'EIIS: Include in Packets: MOU & Exhibits

liBlATHES: .

DeP..•~He~JJ=e.tl . \

IISTlIIUTION: legal - Richman

ell.lIlACDlII:

Division Director

Y"Z::i"J.A~Fo-r""'th-e-:M:-='a-yor J~__

PW&U - Mercer~+f

PW&U - Thacker

November 16. 2009: See Council Action Memorandum dated November 20,2009,for Council Action on November 16, 2009.

November 23.2009: See Council Action Memorandum dated ti@'~ftWEa~1009,

for Council Action on November 23, 2009. SPOKANE CITY COUNCil:

~~~~(1)'R~ H-5('E~HIf>\T~

Return to: City of SpokaneAttn: City Clerk808 W Spokane Falls BlvdSpokane, WA 99201

INTERLOCAL AGREEMENT REGARDING ANNEXATIONSOF PORTIONS OF THE WEST PlAINS URBAN GROWTH AREA

BETWEEN THE CITY OF SPOKANE. THE CITY OF AIRWAY HEIGHTS,AND SPOKANE COUNTY, ,.<ooq- /093t4

THIS AGREEMENT, made and entered into this8.r'daay otrl:Pu07~200!l (the "Effective Daten) by and between the City of Spokane, a Washingtonmunicipal corporation, hereinafter "Spokane", the City of Airway Heights, a Washingtonmunicipal corporation, hereinafter "Airway Heights," and Spokane County. a politicalsubdivision of the State of Washington, hereinafter "County", jointly hereinafter referred toas the "parties."

WIT N E SSE T H:

WHEREAS, Spokane and Airway Heights (hereinafter the "cities") previouslyentered into an agreement titled "City of Spokane. and City of Airway HeightsMemorandum of Understanding" (hereinafter the "MOU"), a copy of which (together withamendments thereto) is attached hereto as Exhibit A and the terms of which areincorPorated into this Agreement; and

WHEREAS, the MOU contemplates the cities entering into an Interlocal Agreementproviding for annexations by the cities within the West Plains Annexation Area. as shownin Exhibit B; and

WHEREAS, the MOU further anticipates that following the annexationscontemplated therein. that the area depicted as the Spokane Annexation Area on Exhibit ~shall be part of the City of Spokane and the area depicted as the Airway HeightsAnnexation Area on said exhibit shall be part of the City of Airway Heights; and

Page 1 of 20(80030008; 1 }

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WHEREAS. the cities wish to further memorialize their intent as set forth in theMOU by entering into an interlocal agreement that requires both cities to engage in acooperative annexation process that will ultimately result in the Spokane Annexation Areabecoming part of the City of Spokane and the Airway Heights Annexation Area becomingpart of the City of Airway Heights; and

WHEREAS, Washington'S legislature, pursuant to Engrossed Substitute Senate Bill5808 (codified in RCW 35.13.238), and consistent with the regional cooperationenvisioned and. anticipated as a result of implementation of the Growth Management Act,Chapter 36.70A RCW rGMA"), has authorized a new method of annexation referred to asthe interlacal method of annexation ("lnterlocal Method ofAnnexation"); and

WHEREAS, in an effort to demonstrate regional cooperation and leadership, theparties have elected to pursue the respective annexations contemplated In this Agreementpursuant to the Interlocal Method of Annexation; and

WHEREAS, at the County's request, and in lieu of any type of annexationmitigation/revenue sharing between the cities and the County, the cities have agreed topostpone the effective date of the annexations contemplated herein until January 1, 2012;and

NOW, THEREFORE, in consideration of the facts and recitals set forth in the MOUand hereinabove, which are adopted herein and made a part of this Agreement and whichthe parties mutually agree constitute good and adequate consideration for the obligationsof the parties set forth herein, the parties hereby agree as follows:

SECTION NO.1: PURPOSE

The purpose of this Agreement is to set forth certain agreements between the partiesrelating to annexations by Spokane and Airway Heights within the West Plains AnnexationArea.

SECTION NO.2; APPLICABILITY OF THIS AGREEMENT

The parties agree that the provisions of this Agreement shall apply to annexations by thecities within the West Plains Annexation Area.

SECTION NO.3; ANNEXTION PROCEDURES

3.1 Interlocal Method of Annexation. Spokane and Airway Heights willpursue annexation of their respective annexation areas within the West PlainsAnnexation Area pursuant to the Interlacal Method of Annexation, as authorized byRCW 35.13.238 (the "Interlocsl Method of Annexation"). Alternatively. the cities mayjointly elect to pursue their respective annexations via the direct petition method of

Page 2 0120{SOO30008; 1}

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annexation as authorized by RCW 35.13.125 at seq (the "Direct Petition Method ofAnnexation"). In either case, the County shall be bound by its commitments in thisAgreement with respect to the annexations contemplated herein.

3.2 Annexation Process.

3.2.1 Notice. The Interlocal Method of Annexation contemplates a cityproposing to initiate an annexation of territory salVed by a fire protection district notifyingthe district and the county of its intentions and stating the city's interest in an interlocalagreement negotiation process. Within ten (10) days of the Effective Date, Spokaneand Airway Heights will send notices that generally conform with Exhibit C. Spokane'snotice shall be addressed to the Board of County Commissioners for Spokane County("BOCC"), Spokane County Fire Protection District No. 10 ("District No. 10"), andSpokane County Fire Protection District No.3, and shall state Spokane's interest toenter into an interlocal agreement negotiation process relating to Spokane's intention toannex the Spokane Annexation Area. Ai/way Heights' notice shall be addressed to theaace and District No. 10 and shall state Airway Heights' interest to enter into aninterlocal agreement negotiation process relating to Airway Heights' intention to annexthe Airway Heights Annexation Area.

3.2.2 Fire District Response. If any fire protection district having territorywithin the boundaries of the Spokane Annexation Area andlor Airway Heights AnnexationArea timely objects or otherwise provides a negative response to either annexationproposal, the city receiving the negative response may abandon and terminate theInterlocal Method of Annexation with respect to its annexation and proceed to annex thatcity's respective annexation area (as identified in this Agreement) pursuant to the directpetition method of annexation under Chapter 35.13 RCW. A negative fire protectiondistrict response to one city's annexation shall not prejudice the right of the other city toproceed with its annexation pursuant to the Interloesl Method of Annexation. OnceSpokane successfully annexes the Spokane Annexation Area, and if Airway Heightsthereafter fails, for any reason, to complete its annexation of the Airway HeightsAnnexation Area with an effective date of January 1,2012, Spokane shall, following itsannexation of the Spokane Annexation Area, and following the exhaustion of any appealsrelative to Airway Heights' annexation efforts, proceed to annex the Ailway HeightsAnnexation Area pursuant to the direct petition method of annexation, subject to therequirements and limitation of Section 3.3 herein below regarding the parties adoption ofcompanion resolutions providing for Airway Heights' annexation of the Airway HeightsAnnexation Area. The parties acknoWledge and agree that Spokane may rely entirely onannexation covenants Spokane has collected over the years in exchange for providingsewer and water service to the West Plains Annexation Area.

3.2.3 Interlocal Agreement. Assuming no fire protection district hasobjected or otherwise provided a negative response to an annexation proposal, the cityand/or cities (as the case may be depending upon whether one or both cities continue to

Page 3 0120{S0030008j 1 }

proceed under the Direct Petition Method of Annexation) and the County Will negotiateinterlacel agreements with the respective fire protection districts relating to the city's and/orcities' respective annexations, the terms of which shall be consistent with the requirementsof RCW 35.13.238 and this Agreement ("Annexation Agreements"). The County herebyacknowledges and agrees to be a party to the Annexation Agreement(s) and willexecute the same upon the request of either or both cities. Once the interlocalagreement negotiation process is complete. the city and/or cities shall thereafter submita notice of intention to the Spokane County Boundary Review Board ("BRB"); provided,if all parties to the Annexation Agreements are in agreement regarding the boundariesof the territory proposed for annexation, the parties acknowledge and agree that theBRB may not invoke its jUrisdiction with respect to the annexation contemplated in theAnnexation Agreement(s). If, within ninety (90) days of the Effective Date of thisAgreement, one or both of the cities is unable to finalize an Annexation Agreement thatincludes an agreement by the relevant fire protection district(s) regarding theenumerated goals as set forth in RCW 35.13.238(c)(2)(a), that city may abandon andterminate the Interlocal Method of Annexation and proceed to annex its respectiveannexation area as identified in this Agreement pursuant to the direct petition method.

3.2A Fire District Employees. Spokane and Airway Heights will seekfire district cooperation in providing the notification to fire district employees required byRCW 35.13.215(1).

3.2.5 Annexation Ordinance. Upon completion of the interlocalagreement negotiation process described in Section 3.2.3 above and execution of theAnnexation Agreements, the city or cities shall prepare ordinances relating to each city'srespective annexation and shall set public hearings on the ordinances as required byRCW 35.13.238. Each ordinance shall provide for an effective date of January 1, 2012.

3.3 Direct Petition Method of Annexation. Upon the abandonment of theInterlocal Method of Annexation by both cities per Section 3.2.2 and/or 3.2.3, Spokane willcommence the annexation of the entire West Plains Annexation Area (including theSpokane Annexation Area and Airway Heights Annexation Area) as shown in Exhibit Bpursuant to the Direct Petition Method of Annexation. The parties acknowledge and agreethat Spokane may rely entirely on annexation covenants Spokane has collected over theyears in exchange for providing sewer and water service to the West Plains AnnexationArea. Following the successful completion of Spokane's annexation of the West PlainsAnnexation Area, SpOkane and Airway Heights will execute companion resolutions, asauthorized by RCW 35.10.217(2) and consistent with the process prescribed therein,providing for Airway Heights' annexation of the Airway Heights Annexation Area.

RCW 35.10.217(2) provides, In summary, the following: (a) the legislative body of acity may by resolution indicate its desire to be annexed to another city in whole or in part orthe, legislative body of a City proposing to annex part of another city may initiate thea~nexation by adopting a resolution stating that desire (the MFirst Resolution"); (b) the

Page4of20{SOO30008; 1 }

annexation is effective if the other city adopts a resolution concurring in the annexation(the "Second ResolutianD

), unless owners of property in the area proposed to be annexed,equal in value to 60% or more of the assessed valuation of the property in the area,protest the proposed annexation in writing to the legislative body of the city proposing toannex the area, which terminates the process; with (c) the annexation potentially SUbjectto review by the Boundary Review Board after adoption of the First Resolution. TheSecond Resolution may not be adopted until the proposed annexation has been approvedby the BRB (if its jurisdiction is invoked). To further the purposes of this Agreement and toavoid frustration of the Parties' intent, and assuming Spokane has successfully annexedthe entire West Plains Annexation Area, Spokane will within forty-five (45) days ofsuccessful annexation of the entire West Plains Annexation Area and exhaustion of appealperiods, adopt a .First Resolution indicating its desire for Airway Heights to annex theAirway Heights Annexation Area. In the event Spokane fails to timely adopt said FirstResolution, Spokane shall pay annually liquidated damages to the City of Airway Heightsthe greater of the stipulated sum of $600,000.00 with such amount adjusted pursuant tothe identified CPI index set· forth in Section 4.2 or the total property and sale tax revenuereceived by Spokane from the Airway Heights Annexation Area less $300,000, until suchtime as Airway Heights is able to annex the Airway Heights Annexation Area or for aperiod of seventeen (17) years, whichever shall first occur (the "liqUidated DamagesTenn"). If, following Spokane's adoption of a First Resolution, Airway Heights is thereafterunable to annex the Airway Heights Annexation Area, Spokane shall, followingsubsequent requests by Airway Heights initiated pursuant to RCW 35.10.217(2), concurwith Airway Heights'effortsto annex the Airway Heights Annexation Area by adopting aSecond Resolution within 45 days of receiving Airway Heights' request unless preventedfrom doing as a result of a BRB decision or a sufficientproperty owner protest pursuant toRCW 35.1 0.211(2); provided, Airway Heights shall bear all costs associated with providingrequired notices. A failure by Spokane to adopt a Second Resolution, unless prevented bylaw or order, shall result in the payment of liquidated damages to Airway Heights for theliqUidated Damages Tenn specified herein above. Provided; Spokane's obligation toadopt a Second Resolution shall expire upon its adoption of a total of five companionresolutions (including both First Resolutions and Second Resolutions) or seventeen (17)years from the Effective Date of this Agreement, whichever occurs first. Spokane and theCounty shall not protest the Airway Heights annexation commenced under RCW35.10.217 or any other method. Spokane and Airway Heights agree that the abovestipulated sum for liquidated damages is a reasonable amount with a precise measure ofdamages being difficult or incapable of precise computation.

The cities agree that, If Airway Heights is able to annex the Airway HeightsAnnexation Area, and if Spokane is unsuccessfUl in its efforts to annex the SpokaneAnnexation Area, the Cities will cooperate to allow Spokane to leverage the annexationcovenants that encumber property within the Airway Heights Annexation Area for a largerannexation of areas Within the West Plains Urban Growth Area pursuant to the proVisionsof HCW 35.10.211(2)&(3) recognizing that the County's obligations under this Agreementare limited to annexations within the agreed upon West Plains Annexation Area.

Page 50120{SOO30008; 1 }

3.4 Duty of Mutual Cooperation. None of the parties will invoke thejurisdiction of the BRB with respect to the annexations provided for in this Agreement.None of the parties shall commence or maintain any action of any kind in any forumchallenging any of the annexations contemplated in this Agreement. Nor shall any partyoppose or otherwise challenge Spokane's reliance on Annexation Covenants (and/orthe validity of such covenants), whether before the Boundary Review Board, aWashington court, or any other forum, in the event the parties elect to proceedaccording to the Direct Petition Method of Annexation. The County's obligations underthis Section 3.4 shall terminate on January 1, 2017.

3.5 GMA Appeal. Within ten (10) days of the Effective Date, Spokane andAirway Heights will enter a stipulated motion seeking dismissal of Case No. 09-1-0005currently pending before the Growth Management Hearings Board for EasternWashington.

SECTION NO.4: ALLOCATION OF SALES AND PROPERTY TAX REVENUE

Spokane and Airway Heights have established a fonnula that will equitably compensateSpokane for revenue that will be lost due to Airway Heights' annexation of the AirwayHeights Annexation Area.

4.1 Tenn of Revenue Sharing. The revenue sharing provisions of this Section4 shall be in effect and continue for a tenn of seventeen (17) years, commencing onJanuary 1. 2013 rCommencement Date") and tenninating on December 31. 2029("Tennination Date"), unless otherwise agreed to by Spokane and Airway Heightsaccording to the terms of this Agreement ("Term").

4.2 Revenue Sharing Payment. The annual revenue sharing payment byAirway Heights to Spokane shall be three hundred thousand dollars ($300,000.00),adjusted annually as provided in this section ("Revenue Sharing Payment"). On January1, 2013 and thereafter on or before January 30 of each year during the Tenn, AirwayHeights shall pay to Spokane. Without notice or demand, the Revenue Sharing Payment,addressed to the City Treasurer. Airway Heights shall make such payments to the City,without deduction or offset. no later than January 30 of each year of the Tenn. TheRevenue Sharing Payment will be adjusted annually as of the anniversary date of theCommencement Date of this Agreement by using the Consumer Price Index for AllUrban Consumers for the West urban area, 1982-84=100 (the "CPt"). If the statedindex is discontinued, Spokane will use the index promulgated by the Department ofLabor which in Spokane's opinion most closely approximates the above index, and theRevenue Sharing Payment will be adjusted accordingly. The latest available semi­annual CPI is 217.786 for the 1st half of 2009. Airway Heights shall be responsible forcalCUlating the adjustment and shall, upon request, within thirty (30) days prior to each

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anniversary date, provide Spokane with documentation pertaining to the calculatedadjustment.

4.3 L,ate Fee. Airway Heights acknowledges that late payment by AirwayHeights to Spokane of Revenue Sharing Payments due hereunder will cause Spokane toincur costs not contemplated by this Agreement, the exact amount of which would beextremely difficult and impractical to ascertain. Those costs include, but are not limited to,processing expenses. and accounting expenses. In the event any amount so due isdelinquent, Airway Heights shall pay Spokane a late charge. computed at the rate of thelesser of 1-1/2 % per month or the maximum rate permissible by law, upon the totalamount so overdue and for each day following its due date that the payment is delinquent.Spokane's acceptance of less than the full amount of any payment due from AirwayHeights shall not be deemed an accord and satisfaction or compromise of such paymentunless Spokane specifically consents in writing to payment of such lesser sum as anaccord and satisfaction or compromise of the amount which Spokane claims.

4.4 Contingencies. The cities acknowledge and agree that the annexationscontemplated under this Agreement may be subject to potential review by the BoundaryReview Board ("BRB"). protest. and referendum.

4.4.1 Airway Heights' revenue sharing obligations hereunder arecontingent upon Airway Heights' annexing all or any portion of the AirwayHeights Annexation Area. If after exhausting all efforts to annex theAirway Heights Annexation Area as contemplated herein Airway Heights isprevented from annexing or otherwise unable to annex any portion thereofof the Airway Heights Annexation Area. Its revenue sharing obligationsunder this Agreement shall terminate; provided. if Airway Heightsthereafter annexes all or any portion of the Airway Heights AnnexationArea within seventeen (17) years following the Effective Date of thisAgreement. its revenue sharing obligations to Spokane hereunder shallapply with the seventeen- (17-) year revenue sharing Tetm commencingon the on&-year anniversary of the effective date of such annexation.

4.4.2 Modification by the BRB of Airway Heights' proposal to annex theAirway Heights annexation area shall cause Spokane and Airway Heightsto renegotiate, in good faith, the revenue sharing provisions of thisAgreement which shall continue to apply during the Term - Le.. AirwayHeights shall make the agreed upon Revenue Sharing Payment accordingto the terms of this Agreement unless and until the renegotiations result ina modification of said obligation.

4.4.3 If the cities pursue the Direct Petition Method of Annexation, and if.following Spokane's successful annexation of the West Plains AnnexationArea, Airway Heights is unable to annex the Airway Heights Annexation

Page 7 0120{SOOJOOO8; 1 }

Area for any reason. the revenue sharing provisions of this Agreementshall terminate; provided. if Airway Heights thereafter annexes all or anyportion of the Airway Heights Annexation Area within seventeen (17) yearsfollowing the Effective Date of this Agreement. its revenue sharingobligations to Spokane hereunder shall apply with the seventeen- (17-)year revenue sharing Term commencing on the one-year anniversary ofthe effective date of such annexation.

4.4.4 Airway Heights' revenue sharing obligations under this Agreementare not contingent upon the outcome of Spokane's efforts to annex theSpokane Annexation Area or any portion thereof and shall continueregardless of the status of those efforts.

4.4.5 The parties acknowledge that until such time as the West PlainsAnnexation Area described in this Agreement (or a portion thereof) isannexed by one or both of the cities, the County will continue to providethe same services in said area or portion thereof that it provided prior tothe Initiation of the annexatlon(s) and will also continue to receive itsregylar share of revenues from said area.

4.5 Fire District No. 10 MitigatIon. Under the Interlocal Method ofAnnexation, Spokane and Airway Heights will deal directly and independently with FireDistrict No. 10 with respect, to the impacts of that annexation, if any. If it becomesnecessary for Spokane to annex the Airway Heights Annexation Area (Whether as part of adirect petition annexation of the entire West Plains Annexation Area as provided in Section3.3 or in a subsequent direct petition annexation of the Airway Heights Annexation Area asprovided in Section 3.2.2). and if the Airway Heights Annexation Area is subsequentlyannexed by Airway Heights pursuant to the process set forth in Section 3.3 above orotherwise, during the Term, Airway Heights shall also be responsible to reimburseSpokane for that portion of Spokane's mitigation payment to Spokane County FireProtection District No. 10 (the "Fire District") attributable to the Airway HeightsAnnexation Area, if any, provided such payment to Spokane shall not exceed theamount nor extend beyond the teon set forth In the "Spokane County Fire ProtectionDistrict No. 10, City of Airway Heights. Fire Department Mitigation Services Agreement",dated March 21, 2008; proVided further, a termination of said agreement and/or adetermination that said agreement is invalid and/or unenforceable shall not excuseAirway Heights from Its reimbursement obligations under this Section 4.5. No later than30 days following the Commencement Date, and thereafter on or before the 30th day ofeach year dUring the Term, Airway Heights shall pay to Spokane, without notice ordemand. such amounts as Spokane is obligated to pay to the Fire District due toSpokane's annexation of the Airway Heights Annexation Area"If any. Airway Heights shallmake such payments to the City,' without deduction or offset, no later than the 301tl day ofeach year of the Tenn. If. for any reason. Airway Heights is unable to annex the AirwayHeights Annexation Area, the reimbursement obligation in this Section 4.5 shall terminate;

Page 8 0120(80030008; 1 }

provided. if following Spokane's annexation of the AirNay Heights Annexation Area,Airway Heights Is thereafter successful in annexing the area pursuant to the process setforth in RCW 35.10.217(2) within seventeen (17) years following the Effective Date ofthis Agreement, Its reimbursement obligations under this Section 4.5 shall apply.

SECTION NO.5: PROVISION OF SERVICES

If the cities pursue the Direct Petition Method of Annexation, upon approval ofSpokane's annexation ofthe West Plains Annexation Area, Spokane will be responsiblefor providing full range of urban governmental services to entire annexation areapending Airway Heights' annexation of the Airway Heights Annexation Area. In thiscase, the cities will develop an Interim agreement to allocate responsibility for serviceprovision pending completion of Airway Heights' annexation of Airway HeightsAnnexation Area.

Both cities are committed to working with each other and with each city's respectivebargaining units towards alternative models for providing essential services (andprimarily fire protection) in a manner that is more cast effective for residents and taxpayers.

SECTION NO.6: UTILITY SERVICE IN JOINT PLANNING AREA

Spokane will continue to provide sewer and water service to the Airway HeightsAnnexation Area, subject to Spokane plans. ordinances, and resolutions. Withoutlimiting the generality of the foregoing, the cities specifically acknowledge and agreethat Spokane may impose its utility tax on services provided by Spokane to the AirwayHeights Annexation Area. Unless expressly stated herein, nothing in this Agreementshall be deemed to modify the terms of any eXisting water or sewer service agreementsbetween the parties. Nor shall this Agreement be deemed to impose a duty onSpokane to provide services, Spokane reserving the right to condition the provision ofservices consistent with Spokane1s Comprehensive Plan, ordinances, policies, andmunicipal code provisions relating to the provision of services beyond Spokane'scorporate limits.

SECTION NO.1: PROTECTION OF ESSENTIAL PUBLIC FACILITIES

Spokane, Airway Heights and the County acknowledge and agree that the SpokaneInternational Airport and Fairchild Air Force Base are two of the region's most essentialpublic facilities and that the parties should discourage development adjacent to eitherfacility that is incompatible with the facilities' operational needs and/or its ability to carryout its current and/or future missions ("incompatible development"). The term"incompatible development" means permitted land uses that are inconsistent with theFairchild Air Force Base Joint Land Use Study ("JLUS"), WSDOT Aviation DivisionRegulations, FAA RegUlations, state statutes or regulations. If any party discovers that

Page 90f20{S0030008; 1 }

an existing comprehensive plan or development regulation does not discourageincompatible development, said party shall take action to amend its comprehensive planand/or development regulation consistent with the requirements of RCW 36.70.547.Prior to amending its development regulations in a manner that may affect property inthe vicinity of either facility, notice shall be provided to (i) the other parties; (ii) theFairchild Air Force Base commander; and (Iii) the Director of the Spokane InternationalAirport. Said notice shall request written recommendations and supporting factsopposing the proposed development regulation or amendment. The notice shall providesixty days for a response. If there is no response Within said 60 days, the party maypresume that implementation of the proposed development regUlations or amendmentwill not have any adverse effect on the operation of the facility.

Following execution of the Agreement, the parties shall take action to adopt regulationsthat prevent incompatible development.

SECTION NO. 8: ADMINISTRATION

Spokane hereby designates its·City Administrator as its representative for the purpose ofimplementing this Agreement Airway Heights hereby designates its City Manager as itsrepresentative for the purpose of implementing this Agreement. The County herebydesignates Chairperson of the Board of County Commissioners as its representative forpurposes of implementing this Agreement.

SECTION NO.9: DISPUTE RESOLUTION

MEDIATION AND ARBITRATION. If any party has a claim or dispute under thisAgreement, notice of the same shall be sent to the other party. The notice shall provide abrief description of the dispute.

Mediation. If the parties are unable to resolve the dispute within ten (10) business days,the parties shall engage a mediator to assist the parties in resolving the dispute. Themediator's fees and costs shall be equally shared by the parties.

Arbitration. If the parties cannot resolve their dispute through mediation, the exclusiveremedy is binding arbitration In accordance with the JAMS Arbitration Rules or by anAlternate Dispute Resolution Process that can be mutually agreed upon. The arbitrator'sfees and costs shall be equally shared. The arbitrator's decision shall be final, binding onthe parties and enforceable pursuant to RCW Chapter 7.04A. The prevailing party shallbe entitled to payment of its attorney fees and costs.

For purposes of this Section 9, the terminology "parties" Shall refer only to those partiesactually involved in the dispute. Any party not Involved in the dispute shall not beconsidered as one of the "parties".

Page 10 of 20(S0030008j 1 )

SECTION NO. 10: TERMINATION

This Agreement may be tenninated at any time by mutual written consent of the parties,The County's obligations under this Agreement shall terminate upon the earlier ofsuccessful completion of the annexations contemplated in this Agreement or January 1,2017, except as extended by the provisions of Section 13 herein below.

SEcnONNO. 1.1: CONTINUED MAINTENANCE OF INFRASTRUCTURE

The County shall continue to perform routine maintenance of County infrastructure,inclUding streets, sewers, water, storm water, and similar public facilities within the WestPlains Annexation Area until the effective date of the annexations contemplated herein.

SECTION NO. 12: TAX INCREMENT FINANCING

The County shall obtain the written approval of Spokane and Airway Heights, which eithercity may withhold for any reason, prior to creating any new or additional tax Incrementfinancing areas within the West Plains Annexation Area or any similar measures that resultin the diversion of property and/or sales and use tax to finance public improvements.

SECTION NO. 13: COMPREHENSIVE PLAN AMENDMENTS - DEVELOPMENTREVIEW

In the event there is any challenge of which stays the effective date of the annexationscontemplated by either or both cities, then the January 1, 2012 date referenced insubsections 13.2. 13.3, and 13.4 shall be extended until the stay jf lifted. Provided furtherif there is any challenge in court to either or both of the annexations which is successful,then the obligation under this Section shall be null and void as to any successful legalchallenge.

13.1 Land Use Changes. The County shall not amend any use and/or zoningdesignations for properties within the boundaries of the West Plains Annexation Areawithout first providing written notice to both cities and giving due consideration to writtenand verbal comments submitted timely by the cities. Nor shall the County approve anytext amendments to its comprehensive plan or related development regulations that wouldhave the effect of allowing a change of use of property within the boundaries of the WestPlains Annexation Area without first providing written notice to both cities and giving dueconsideration to written and verbal comments timely submitted by the cities;

13.2 Development Review Within Pending Annexation Areas. The Countyshall process to completion any development for which it received a complete permitapplication and accompanying fee prior to January 1, 2012, except when early transfer ofauthority occurs as described in Subseclion 13.5 below. "Completion" shall mean final

Page 110120{SOO30008: 1 }

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administrative approvals and certifications to include extensions of time in the case ofsubdivisions, except in the case of legislative actions; in which case decisions will be madeby the Board of County Commissioners or transferred to the City Council if annexation hasoccurred. Where the County continues to have jurisdiction, the County will confer with thecities on all development review decisions affecting the pending annexation area(s).

13.3 Building Pennits. Except when early transfer of authority occurs asdescribed in Subsection 13.5 below, building, plumbing, mechanical, fuel gas residential,energy, and/or fire code pennits issued by the County shall be processed by the Countythrough final inspection and/or certificate of occupancy. Commercial bUilding andresidential pennit applications, to include ancillary permits i.e. mechanical, plumbing, firealarm, sprinkler, etc., such as where plan review fees have been paid shall be processedby the County through pennit issuance, final Inspection, and certificate of occupancy. Thefinal inspection may be a jOint City/County inspection, with the city being afforded theopportunity to be in attendance for information purposes. After the effective date of theannexation, the cities and County may meet from time to time to review the status of allactive projects In the annexation area remaining under review by the County anddetermine whether or not responsibility for continued processing should be transferred tothe city. Any requested renewals of such applications shall be made to and administeredby the city.

13.4 Code Enforcement Upon request, the County will provide the cities withinfonnation regarding any properties which are subject to pending County codeenforcement action.

13.5 Early Transfer of Authority Authorized. It is the intent of the parties tofacilitate timely processing of development applications for properties that are locatedWithin the boundaries of the West Plains Annexation Area. When a property owneragrees, the County will, in writing, transfer 'review, pennit-processing, and decisionauthority to the city for projects submitted prior to annexation. If annexation proceedingsare delayed to such a degree that it is probable that development review would becompleted prior to completion of the annexation, the city will return review and processingauthority to the County to ensure continuous processing of development applications

SECTION NO. 14: DEFAULT

The occurrence of anyone or more of the following events shall be an "Event of Default"under this Agreement:

14.1 Failure by either Spokane, Airway Heights, or the County to pelform,observe, or comply with the covenants. agreements, or conditions on its part contained inthis Agreement, other than the making of any payment required hereunder, where thatfailure continues for a period of thirty (30) days after written notice from the non-defaultingparty; or

Page 12 of 20(50030008; 1 )

SPOKANE:

14.2 Failure by Airway Heights to make any Revenue Sharing Payment whendue.

SECTION NO. 15: REMEDIES

Following an Event of Default, other than the making of or failure to make any paymentrequired hereunder, any party may commence the Dispute Resolution process set forth inSection 9. Following an Event of Default involving the making of or failure to make anypayment required hereunder, the non-defaulting party may at any time, without waiving orlimiting any other right or remedy, pursue any remedy allowed by law including, by way ofexample and without limitation, specific perfonnance, declaratory jUdgment, and otherequitable remedies, and recovery of attorneys' fees and other costs for such enforcementaction.

seCTION NO. 16: NOTICE

All notices shall be in writing and served on any of the PARTIES either persolJally or bycertified mail, retum receipt requested, to the persons below designated as contactpersons. Notices sent by certified mall shall be deemed served when deposited in theUnited State mail, postage prepaid.

City Administrator orhis/her authorized representative808 West Spokane Falls BlvdSpokane. Washington 99201

AIRWAY HEIGHTS: City Manager or his/her authorized representative1208 LundstromAirway Heights, Washington 99001

COUNTY: Chairperson, Board of County CommissionersW. 1116 BroadwaySpokane, Washington 99260

SECTION NO. 17: AGREEMENT TO BE FILED

The County shall file this Agreement with the County Auditor. Spokane shall file thisAgreement with its City Clerk. Airway Heights shall file this Agreement with its CityClerk.

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SECTION NO. 18: COMPLIANCE WITH LAWS

The parties shall observe all applicable federal, state and local laws, ordinances andregulations in conjunction with meeting their respective obligations under the terms ofthis Agreement.

SECTION NO. 19: VENUE STIPULATION

The laws of the State of Washington shall be applicable to the construction andenforcement of this Agreement. Any action at law, suit in equity or judicial proceedingregarding this Agreement shall be instituted only in courts of competent JUrisdictionwithin Spokane County, Washington.

SECTION NO. 20: MODIFICATION

No mOdification or amendment of this Agreement shall be valid until the same isreduced to writing and executed with the same formalities as this present Agreement;provided, upon termination of the County's obligations as provided in Section 10 above,the County's signature shall not be reqUired to amend this Agreement.

SECTION NO. 21: WAIVER

No officer, employee, agent or otherwise of any party has the power. right or authority towaive any of the conditions or provisions of this Agreement. No waiver of any breach ofthis Agreement shall be held to be a waiver of any other or subsequent breach. Allremedies afforded in this Agreement or at law shall be taken and construed as cumulative,that is, in addition to every other remedy provided herein or by law.

SECTION NO. 22: ALL WRITINGS CONTAINED HEREIN

This Agreement contains all the tenns and conditions agreed upon by the parties. Noother understandings, oral or othelWise. regarding the subject matter of this Agreementshall be deemed to exist or to bind the parties. The parties have read and understand allof this Agreement, and nqw state that no representation, promise or agreement notexpressed in this Agreement has been made to induce any of them to execute It.

SECTION NO. 23: HEADINGS

The section headings in this Agreement have been inserted solely for the purpose ofconvenience and ready reference. In no way do they purport to, and shall not be deemedto, define, limit or extend the scope or intent of the sections to Which they pertain.

Page 14 of 20{S0030008; 1 }

SECTION NO. 24: SEVERABILITY

In the event any portion of this Agreement should become invalid, or otherwiseunenforceable, the rest of this Agreement shall remain in full force and effect.

SECTION NO. 25: BINDING EFFECT

Both parties warrant that they have the full power and authority to execute and deliver thisAgreement and to perform their respective obligations under this Agreement. ThisAgreement constitutes a valid and legally binding obligation of both parties and isenforceable in accordance with its provisions.

SECTION NO. 26: TIME IS OF THE ESSENCE

Time is of the essence of this Agreement.

SECTION NO. 27: RCW 39.34 REQUIRED CLAUSES.

A. PURPOSE.

See Section No 1 above.

B. DURATION;

See Section No. 1() above.

C. ORGANIZATION OF SEPARATE ENTITY AND Irs POWERS.

No separate legal entity is necessary in conjunction With this Agreement.

D. RESPONSIBILITIES OF THE PARTIES.

See provisions above.

E. AGREEMENT TO BE FILED.

See Section No. 17 above.

F. FINANCING.

See Section NO.4 above.

Page 150120{S0030008; 1 }

G. TERMINATION.

See Section No. 10 above.

H. PROPERTY UPON TERMINATION.

Title to all property acquired by any party In the performance of this Agreementshall remain with the acquiring Party upon tenninatlon of the Agreement.

SEcnON NO. 28: NO THIRD PARTY BENEFICIARIES

Nothing in this Agreement is Intended to give, or shall give, whether directly or indirectly,any benefit or right, greater than that enjoyed by the general public, to third persons.IIIIIIIIIIIIIIIIIIIIIIIIIIIIII

Page 18of20{SOO30008; 1 )

IN WITNESS WHEREOF, the parties have caused this Agreement to be executedon date and year opposite their respective signatures.

DATED:----------e~

Attest:

City Clerk

Attest:

CITY OF SPOKANE

·By: ~~Its: ~---.f~ "';;....---~ru

Approved as to ttWrW:SpokanB

AsSiSt8TltCitYAttorney

CITY OF AIRWAY HEIGHTS

Approved as to form:

of C0"'ttt,J;r.;t'O #"ECo··. ~: (:i l~-i'~\. . .

. . .13---

~~~~~ ~T"",,=:-....f-M~I~E~L~K~E-,C~h:""a~ir~~~~---~ATTEST: ~

~~Daniela Erickson I Is. /?J'1H'")Clerk of the Board I~ /GV"V ~-~--...~~

BONNIE MAGER,C~

Page 17 0120{S0030008; 1 }

Page 18 of 20{S0030008; 1 }

Exhibit A

Memorandum of Understanding

-

CLERK'S FILE f¥J~RENEWSCROSS REFE;NGBIDREQUlsrnON

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••11.Ulln: CITY OF SPOKANE AND CITY OF AIRWAY HEIGHTS MEMORANDUM OF UNDERSTANDING

REGARDING ANNEXATiON ON THE WEST PlAINS

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Spokane County has designated the Urban Growth Area adjacent to Airway Heights asa Joint Planning Area (JPA) between Spokane, Airway Heights, and Spokane County.This lPA lies within Spokane's water and sewer service areas and Spokane hasextended both water and seWer service to the lPA in exchange for property owners'commitments to annex Into Spokane. Spokane has collected annexation covenantsencompassing approximately 95· % of the assed value of land lying within the JPA.Both Spokane and Airway Heights have been exploring the feasibility of annexing thelPA, and both believe that mutual cooperation regarding annexation of the JPA Is inthe best Interests of the citizens of both jurisdictions and of those re.,,>idmg andconducting business within the JPA and Wish to enter into the attached Memorandumof Understanding, which contemplates a subsequent Interlocal Agreement underChapter 39.34 RCW to address annexatIons by both parties within the JPA and tofurther address the financial irnpacts of such annexation•

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APPROVED BYSPOKANE CITY COUNCIL:

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CITY OF SPOKANE AND CITY OF AIRWAY HEIMEMORANDUM OF UNDERSTANDING

A. INTRODUCTION, This Memorandum of Understanding is by and between theCity of Spokane. a f1rst·c::lass charter city of the State of Washington ("Spokane") andthe City of Airway Heights, a non~charter code city of the State of Washington ("AirwayHeights"), jointly referred to as "parties".

The porpose of this Memorandum of Understanding ("MOU") Is to (1) commit theparties to cooperate 'in good faith and attempt to reach an agreement upon the termsand conditions of an Interlocal Agreement providing for the annexation and de~

annexation of a portion of the West Plains Joint Planning Area (or"Joint Planning Area")as depicted on the attached Exhibit B ("Interlacal Agreement for Joint Planning andAnnexation of the West Plains Joint Planning Area" or "Ioterlooal Agreement") and (2) toset forth the parties' understanding as to the principal terms of such an agreement.

B. BACKGROUND. Spokane and Airway Heights believe that mutual cooperationwith respect to annexation of the "West Plains Annexation Area" (depicted In AttachedExhibit A), which includes the Joint Planning Area is in the best interests of the citizensof both jUrisdictions and of those residing within the West Plains Annexation Area andJoint Planning Area and wish to enter Into this Memorandum of.Understanding and thesubsequent Interlocel Agreement under Chapter 39.34 RCW to address annexationswithin the Joint Planning Area and to further address the financial impacts of suchannexation and the possibility for cooperative provision of urban governmental serviceswithin the Joint Planning Area.

C, STAND STILL AGREEMENT.

1. Stand Still Period. The parties shaU, for a period of 30 days commencingon the Effective Date, cooperate in good faith and attempt to reach an agroeementregarding the terms and conditions of the Interlocal Agreement rStand Still Period").

2. Prohibited Activities. During the St~nd Still Period, which the parties mayextend by mutual written agreement, and except as expressly provided herein. theparties and their respective officers, employees, and agents shall not take any actionleading towards or otherwise facilitating annexation of all or any portion of the JointPlanning Area, By way of example, and without limitation, neither of the parti$s shall:(a) Place any matter relating to annexation of the Joint Planning Area on the legislativeagenda of their respective city councils; (b) schedule any meetings with property ownersrelating to annexation of the Joint Planning Area; (c) take any legislative action relatingto annexation proposals; or (d) solictt property owner signatures on annexation petitionsor oause others to do the same.

3. Exceptions. Thl$ stand still provision shall not apply to the following: (a)action by the parties relating to approval of this MOU by their respective city councils;(b) annexation activities by Spokane In those areas of the West Plains Annexation Area

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outside of the Joint Planning Area; (c) the cooperative work contemplated by the partiespUl'$uant to this MOU; (d) discu8&ioM and/or correspondence with Spokane County. theBoutldary Review Board, special purpose districts andlor service providers regardingthe terms of 1his MOU and annexation seNice and/or mitigation agreements; (e) themutual communication described in Section 0 herein below; (f) responses by the partiesand/or the paTties' employees and agents to citl2en inquires regarding the terms of thisMOU and that arB otherwise consistent with the parties obligations under Section (C)(2)herein above; or (9) communications by the parties and/or the parties' employees andagents· with persons owning or having an Interest in property within the West PlainsAnnexation Area on matters unrelated to annexation.

4. utility Covenants. This stand stili provision shall not limit Spokane'sauthority to require Annexation Covenants from property owners requesting spokane'swater and/or sewer service In the West Plains Annexation Area, including the JointPlanning Area. .

5. Annexation Activities. For purposes' of this Section C, annexationactivities by Spokane means contact with property owners outside of the Joint PlanningArea advising said owners of the terms of this MOUI reminding property owners of theannemt!on covenants property owners in the area have signed in exchange forSpokane's utility services C'Annexation Covenants"), and of the benefits of annexationinto Spokane. Spokane will: (a) provide Airway Heights with courtesy copies of all suchcommunioation occurring after the EffectiVe Date of this MOU and (b) invite AitwayHeights to participate in arranged meetings with persons identified herein.

D. MUTUAL COMMUNICATION TO PROPER1Y OWNERS IN JOINT PLANNIN~

AREA. Within 10 days of the Effective Date of this MOU, the Mayors of Spokane andAirway Heights will prepare and mail joint letters notifying property owners wi~hin theJoint Planning Area of the Annexation Covenants and of the parties' work towards acooperative approach to annexation of the Joint Planning Area.

E. PROPOSED TERMS AND CONDITIONS OF INTERlOCAL AGREEMENT. Theparties shall cooperate in good faith and attempt to reach an agreement on an InterlocalAgreement that includes, but is not limited to, the following terms:

1. Property. The Interlocal Agreement shall apply to annexations by theparties within the West Plaints Annexation Area, including the Joint Planning Area. TheInter10cal Agreement will provide that: (a) Upon Spokane's successful annexation of theWest Plains Annexation Area, and subject to the terms of the Interlacal Agreement,Spokane will by resolution indicate its desire for those portions of the Joint PlanningArea depicted in Exhibit C ("AH Annexation Area b

) to be annexed to Airway Heights andshall thereafter transmit said resolution to Airway Heights, as authorized by RCW35.10.217(2); (b) Airway Heights' annexation ofthe AH Annexation Area will be effectiveif Airway Heights adopts a resolution concurring In the annexation, subject to the termsof RCW 35.10.217(2) ("De~annexationQ); and (0) the AH Annexation Area will generallybe described as that area beginning at the comer of Hayford Road and 21 81 Street. then

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east along 21't Street to Hazelwood, then north on Hazelwood to a point that Is parallelto the southern end of Deer Heights, then east to Deer Heights, then due north on DeerHeights to· Hwy 2, then continuing due north to 6th Street, then west on 6th Street toHayford Road, then south on Hayford Road to the point of beginning, all of said areabeing adjacent to the east corporate limits of Airway Heights.

2. legal AuthQfity. The Interlocal Agreement will provide for Spokane topursue annexation of the West Plains Annexation Area pursuant to the direct petitionmethod, as authorized by Chapter 35.13 RCW. In order to satisfy the 75 percentSignature requirement, the parties agree that Spokane will rely primarily on theAnnexation Covenants. The parties mutually agree that, under Washington law, and forpurposes of the direct petition method of annexation, the Annexation Covenantsconstitute the equivalent of the signatures of the current owners of property wlthin theWest Plains Annexation Area. The InterloC81 Agreement will provide for Airway Heights'subsequent annexation of the AH Annexation Area pursuant to the process set forth inRCW 35.10.217(2). Spokane wlll place on the City Council Agenda for adoption theresolution contemplated by RCW 35.10.217(2) which provides Spokane is requestingthat Airway Heights annex a portion of Spokane. The agreement will provide for theparties' mutual cooperation with the above prooess. The parties are not providing for aconsolidation of the two cities.

3. Miscellaneous. The Interlocal Agreement, pursuant to RCW 39.34, shallprovide for the annexation and de-annexation by the parties within the Joint PlanningArea in general conformance with the above legal authority. Further terms andconditions, as mutually agreed between the parties, shall ensure mutual cooperationthrough the annexation process, covenants for de-annexation, remedies to compelperformance of the Interlocal Agreement, provision of public health and safety services,revenue sharing "and all other reasonably related matters.

4. Revenue Sharing. In consideration for the parties' mutual cooperation inthe annexation Bnd de-annexation process outlined herein, the Interlacel Agreement willprovide a formula under which the parties will share property end sale tax revenueSgenerated in the AH Annexation Area for an agreed upon term. In additionl to saidconsideration, it is Intended that the revenue sharing will be dedioated to supplementingthe provision of urban governmental services to the West Plains Annexation Area. Therevenue sharing provisions will Include contingency formulas to apply in the event theBRB modifies the annexation boundary between Spokane and Airway Heights proposedIn this MOU.

5. Utlljty Services. The Interlocal Agreement will address the terms underw.hich Spokane will provide se\\f8r and water services to the AH Annexation Area,subject to Spokane plans, ordinances and resolutions· related to mtes, charl!lBs andfees. Spokane utility tax may also be assessed on services provided by Spokane to theAH Annexation Area. Unless expressly stated herein, nothing in this MOU shall bedeemed to modify the terms of any existing water or sewer service agreements betweenthe parties. Nor shall this MOU be deemed to impose a duty on Spokane to prOVide

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services, Spokane reserving the right to condition the provision of services consistentwith Spokane's Comprehensive Plan. ordinances, policies, and municipal codeprovisions relating to the provision of service beyond Spokane's corporate limits..

6. Dispute Resolution. The Intertocal Agreement will incorporate terms foralternative dispute resolution. The agreement will also provide adequate remedies toencourage full perfonnance of the parties' respective obligations under the agreement.

7. Boundary Review Board I Spokane County. The Interlocal Agreement willobligate the parties to meet and confer with representatives of the Boundary ,ReviewBoard (BRB) and the Board of County'Commissioners for Spokane County in order tosuccessfully advance the annexation/de-annexation and implement the terms of theInterloesl Agreement. The parties recognize that Spokane's annexation of the WestPlains Annexation Area and the d~annexationare both SUbject to potential review bythe BRB. The parties aCknowled~e and agree that it Is within their mutual best interestto cooperate and facilitate Spokane" annexation of the West Plains Annexation Area,Including the Joint Planning Area, subject to the de-annexation by Airway Heights. Theparties further acknowledge and agree that it is within their mutual best interest tocooperate to facilitate the de-annexation following such annexation. To that end,neither party shall oppose or otherwise challenge the efforts of the other party tocomplete the annexation and de·annexation contemplated by this Memorandum ofUnderstanding and the Interloc8lAgreement. The parties shall meet, confer and agreeupon written statements of aupport for the Spokane and Airway Heights annexations.

8. Schedule. The parties commit to the following schedule:

(a) Weekly meetings - Commencing the week of January 19, 2009, theparties shall designate key staff and hold weekly meetings to work on the termsof the Interlocal Agreement

(b) January 12. 2009 - MOU submitted to Spokane and Airway Heights CityCouncils. The parties will exercise best efforts to obtain approval/ratification ofthe MOU by their respective councils no later than January 20, 2009. The Mayorof each party shall Immediately contact the Mayor of the other party if ~hey' areunable to obtain city council approval/ratification. This MOU shall not be effectiveif one or both parties are unable to obtain approval of their respective CityCouncil(s) by January 20,2009.

(0) February 2009 - Spokane and Alr:way Heights City Councils adoptInterlocal Agreement and necessary resolutions. If one or both parties areunable to obtain approval of their respective City Council(s) on or before 11:59p.m. Pacific Standard Time on January 20, 2009. this MOU shall terminate andbe of no further effect If either party Is unable to obtain approval of saiel party'srespective City Council by said deadline. the Mayor of said party shallimmediately notify the Mayor of the other party by telephone and a-mail.

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(d) Maroh 2009 - Spokane will commence annexation of the West PlainsAnnexation Area by conducting meeting with property owners to Initiateannexation. Spokane will thereafter prepare an annexation petition relyingprimarily on the Annexation Covenants ("Annexation Petition") and will forwardthe same to the County Assessor for a determination of sufficiency. Uponreceiving certification from the Assessor, Spokane will schedule a hearing on theAnnexation Petition and an annexation Ordinance (to become effective uponBRB approval of the annexation) after which it will submit a notice of intentto theBoundary Review Board. A copy of the Interlocal Agreement will accompanySpokane's notice of intent and Spokane will ask the BRB to invoke its jurisdictionwith respect to the annexation proposal.

(e) Within 45 days of BRB final approval of Spokane's annexation of the WestPlains Annexation Area, the Spokane City Council will by resolution indicate itsdesire for the AH Annexation Area to be annexed to Airway Heights ("De­Annexation Resolution-) and shall Immediately thereafter transmit said resolutionto Airway Heights, as authorized by RCW 35.10.217(2).

(f) Within 30 days of Spokanr:t's approval of the De-Annexation Resolution,Airway Heights will submit a notice of intent to the BRB evidencing its intent toannex the AH Annexation Area.

(g) Following BRB approval of Airway Heights' annexation of the AHAnnexation Area, the Airway Heights City Council will adopt a resolutionconcurring with Spokane's DeMAnnexation Resolution. Airway Heights willprovide notice of the public hearing at which it will consider said resolutionconsistent Ylith the requirements of RCW 35.10.217(2).

(h) If necessary, Spokane adopts de-annexation ordinance for AH AnnexationArea; Airway Heights; adopts ordinance providing for annexation of AHAnnexation Area.

F. BINDING EFFECI. Both parties warrant that they have the full pOwer andauthority to execute and deliver this MOU and to perform their respective obligationsunder this MOU. This MOU constitutes a valid and legally binding obligation of bothparties and is enforceable in accordance with Its provisions.

G. DEEAULT AND REMEDIES. It shall be an Event of DefaUlt under this MOU ifeither of the parties fails dUly to perform, observe or comply with the Stand Stillprovisions of Section C herein above during the Stand Still Period, as may be mutuallyextended by the panies in writing. Upon the occurrence and continuance of an Event ofDefault, the non-defaulting party may seek specific performance, declaratory judgment,or other equitable remedies and recovery of attorneys' fees and other costs for suchenforcement action. In addition to said equitable remedies, upon the occurrence of anEvent of Default that leads to or results In annexation of all or a portion of the JointPlannIng Area. the defaUlting party shall pay the other party·an amount equal to all of

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the sales and property tax revenues generated within said annexation area for a periodof ten (10) years. Each party hereby acknowledges and agrees that damages and/orharm to the other party resulting from such an Event of Default would be such that it isincapable or very difficult of ascertainment, and further agree that the foregoingliquidated damages Is a reasonable forecast ot just compensation for harm caused bysuch an Event of Default.

H. EFFECTIVE DATE. This MOU is effectivp. the 201h day of January, 2009 (the"Effective Date").

J. WAIVER AND COMPROMISE. Except as provided in Section F and G hereinabove, this MOU shall not form the basis for any claim, demand, waiver, estoppel,adrni.ssion or course of action against either party. This MOU is an attempt to reachaccommodation and agree to terms and conditions of annexation.

Attest:

Attest:

CITY OF SPOKANE

CITY OF AIRWAY HEIGHTS

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Approved as to form:

The undersigned agree to place this MOU on the January 20, 2009 agel1das of theirrespective city councils for approval on that date and further agree to exercise bestefforts to obtain approval of the same.

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CITY OF SPOKANE

By --.Lkle-.... 8, vib--+s­Mary Verner, Mayor

CITY OF AIRWAY HEIGHTS

By A/",J?~rMatthew Pederson. MQyor

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Exhibit A

Map of West Plains Annexation Area

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Exhibit C

Form of Notice to County and Fire Protection Districts

Re: NOTICE OF REQUEST TO ENTER INTO ANNEXATION INTERLOCALAGREEMENT NEGOTIATION PROCESS

Dear _

The elected leaders of the City of Spokane, City of Airway Heights, and Spokane Countyrecently completed negotiations regarding the cities' plans to annex certain territorylocated within the West Plains Urban Growth Area. A copy of an agreement approvedby all three governments is enclosed ("Revenue Sharing Agreement").

Please be advised that, pursuant to RCW 35.13.238, the City of [Spokane or AirwayHeights] hereby requests Spokane County's and Spokane County Fire Protection DistrictNo. [10'5 and 3's] participation in an interlocal agreement negotiation process relating tothe City of [Spokane's or Airway Heights1 intention to annex certain portions of the WestPlains Urban Growth Area, identified as the ["Spokane Annexation Area" or "AirwayHeights Annexation AreaH]in the enclosed map, Pursuant to RCW 35.13.238, you haveforty·five (45) days to respond to this request in the affirmative or negative. A negativeresponse must state the reasons you do not wish to participate in an interlocalagreement negotiation. A failure to respond within the forty-five day period will bedeemed an affirmative response and the interlocal negotiation process will proceed.

Thank you for your attention to this notice. Please feel free to call if you have anyquestions or concerns. We look forward to a productive negotiation resulting in amutually agreeable interlocal agreement that is consistent with the provisions of RCW35.13.238. .

Very truly yours,

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OPR09-0018

First Amendment of Memorandum of Understanding extending the deadlines in the originalMemonJtm~ of Understanding dated January, 20, 200S, between City of Spokane and City ofA1rwa~ng ennexoatlon on the West Plains.

This amendment provid81 for extensions in the deadlines In the Memorandum of Understanding.The City and AirWay Heights previously entered Into • Memorandum of Understanding Wherein itwas agreed that both pantes woulcl work on an Interlocal agreement for joint planning andannexations on the West Plains. The City is making gOod progress with Airway Heights, BothSpokane County and the Spokane International Airport are now involVed in the dialogue. AdditionaltIme Is needed to work on details relating to the Interloc8l agreement end proposed annexations.

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FIRST AMENDMENT OFMEMORANDUM OF UNDERSTANDING

b!L. Itlti V"cJ,This First Amendment is entered into this.~ -- day of ~8~F..aFy, 2009, by and

between the City of Spokane, a first class charter city of the State of Washington("Spokane") and the City of Allway Heights. a non-charter code city of the State ofWashington ("Airway Heights"), jointly referred to as "parties".

Whereas, on January 20, 2009, the parties entered into a Memorandum ofUnderstanding agreeing to negotiate and approve an interlocal agreement tor jointplanning within and annexation and de~annexatjonof urban growth areas lying betweenthe parties' corporate boundaries (the "MOU"); and

Whereas, the parties wish to amend the MOU as it relates to extending the standstill provisions, defining activities allowed during the stana still period, and the scheduleof events;

NOW THEREFORE, the parties agree as follows:

1. MOU. The MOU, dated January 20, 2009, and any previous amendmentsand/or extensions/renewals, thereto, afe Incorporated by reference into this documentas though written in full and shall remain In full force and effect except 85 providedherein.

2.follows:

c.

AMENDMENT OF SECTION C. Section C of the MOU is amended as

STAND STILL AGREEMENT.

1. Stand Still period. The parties shall « . Wf~days GommeRsiAfj en the Effeetivo Date» un I 20, cooperate in""" ,.11/good faith and attempt to reach· an agroement regarding the terms andconditions of the Interlocal Agreement ("Stand Stili Period").

2. Prohibited Activities. During the Stand Still Period, which theparties may extend by mutual written agreement, and except a5 expresslyprovided herein, the parties and their respective officers, employees. andagents shall not take any action leading towards or otherwise facilitatingannexation of all or any portion of the Joint Planning Area. By way ofexample, and Without limitation, neither of the parties shall: (a) Place anymatter relating to annexation of the Joint Planning Area 'on the legislativeagenda of their respective city councils; (b) schedule any meetings withproperty owners relating to annexation of the Joint Planning Area; (c) takeany legislative action relating to annexation proposals; or (d) solicitproperty ownor signatures on annexation petitions or cause others to dothe same.

Page 1 ors

3. Exceptions", This stand still provision shall not apply to thefollowing: (a) action by the parties relating to approval of this MOU andglny amendments hereto by their respective city councils; (b) annexationactivities by Spokane in those areas of the West Plains Annexation Areaoutside of the Joint Planning Area; (c) the cooperative work contemplatedby the parties pursuant to this MOU; (d) discussions and/orcorrespondence with Spokane County, representatives of the Spok.aneInternational Alroort. Including board .members and labor uniohLepresentatiyes. the Boundary Review Board,special purpose districtsandlor service providers regarding the terms of this MOLJ and annexationservice andlor mitigation agreements; (e) the mutual communicationdescribed in Section D herein below; (f) responses by the parties and/orthe parties' employees and agents to inquiries by citizens and propertyowners regarding the terms of this MOU and the potential impacts ofannexation on citizens and property owners, including meetlng§ betweencitizens/property owners and the parties' respective administrative staff{((inslwding attornoy/eliaRt meetinfjJs))), that are otherwise consistent withthe parties obligations under Section (C)(2) herein above; «(OF» (g)communications by the parties and/or the parties' employees and agentswith persons owning or haVing an interest in property within the WestPlains Annexation Area on matters unrelated to annexation; or lh) themeeting cQntemplated by subsection 8(d) hereh) b..elow.

4, Utility Covenants, This stand still proVision shall not limitSpokane's authority to require Annexation Covenants from propertyowners requesting Spokane's water and/or sewer service in the WestPlains Annexation Area, including the Joint Planning Area.

5. Annexation Activities. For purposes of this Section C,annexation activities by Spokane means contact With property ownersoutside of the Joint Planning Area advising said owners of the terms ofthis MOU, reminding property owners of the annexation covenantsp'roperty owners in the area have signed In exchange for Spokane's utilityservices ("Annexation Covenants"), and of the benefits of annexation IntoSpokane. Spokane will: (a) provide Airway Heights with courtesy copiesof all such communication occurring after the Effective Date of this MOUand (b) invite Airway Heights to participate in arranged meetings withpersons Identified herein.

3.follows:

AMENDMENT OF SECTION 0, Section D of the MOU is amended as

D. .MUTUAL COMMUNICATION TO PROPERTY OWNERS IN JOINTPLANNING AREA. «('NitJ:lIA 10 days of the eneef:lve Date of tl=lis MOY. t))Ihe Mayors of Spokane and Airway Heights mutually agreed upon the

Page 2 of5

CQntent~will ~rapare and maU)) joint letters which have been mailednotifying property owners within the Joint Planning Area of the AnnexationCovenants and of the parties' work towards a cooperative approach toannexation of the Joint Planning Area.

4. AMENDMENT OF SECTION E(B). Section E(B) of the MOU is amendedas follows:

8. Schedule. The parties commit to the following schedule:

(a) Weekly meetings - Commencing the week of January .19, 2009.the parties shall designate key staff and hold weekly meetings to work onthe terms of the Interlocal Agreement.

(b) January 12, 2009 - MOU submitted to Spokane and AirwayHeights City Councils. The parties will exercise best efforts to obtainapprovaVratification of the MOU by their· respective councils no later thanJanuary 20, 2009. The Mayor of each party shall immediately contact theMayor of the other party if they are unable to obtain city councilapproval/ratification. This MOU shall not be effective if one or both partiesare unable Lo obtain approval of their respective City Council(s) byJanuary 20. 2009.

(c) «(Febr:uaf}'» Mav 11, 2009 - Spokane and Airway Heights CityCouncils adopt Interlacal Agreement and necessary resolutions. If one orboth parties are unable to obtain approval of the Interlacel Agreement bytheir respective City Council(s) on or before 11 :59 p.m. Pacific StandardTime on «(JaAu8f)' 20,» Mav 11, 2009, this MOU shall terminate and be ofno further effect; provided, the parties' respective rights and remedies fora ylolatlonb)! the other party of the stand still proVisions of this MQU shallsurvive such teuninatjon. If either party is unable to obtain approval ofsaid party's respective City Council by said deadline, the Mayor of saidparty shall immediately notify the Mayor of the other party by telephoneand a-mail.

(d) CCMaroR)) May 25. 2009 - Spokane will commence annexation ofthe West Plains Annexation Area by q:>nducting meeting with propertyowners to initiate annexation. Spokane will thereafter prepare anannexation petition relyIng primarily on the Annexation Covenants("Annexation Petition") and will forward the same to the County Assessorfor a determination of sufficiency_ Within seven (7) days of Spokane'sreceipt of suc!l1(UpsR F86siving» certification from the Assessor, Spokanewill schedUle a hearing on the Annexation Petition and an annexationOrdinance (to become effective upon BRB approval of the annexation)after which it will submit a notice of intent to the Boundary Review Board.A copy of the Interlacal Agreement will aocompany Spokane's notice of

Page 3 of5

-----~_._--

intent and Spokane will ask the BRB to invoke its jurisdiction with respectto the annexation proposal; provided. upon an agreement betweenSpokane. Airway Hejghts, and Spokane County thai nQmt of the partiesshall invoke BBB jurisdiction, neithf;lr of the parties will invoke 6BBjurisdictlpn with respect to the annexation proposal.

(e) Within 45 days of BRB final approval of Spokane's annexation ofthe West Plains Annexation Area, the Spokane City Council will byresolution indicate Its desire for the AH Annexation Area to be annexed toAirway Heights ("De-Annexation Resolution") and shall immediatelythereafter transmit said resolution to Airway Heights, as authorized byRCW 35.10.217(2).

(f) Within 30 days of Spokane's approval of the De~Annexation

Resolution. Airway Heights will submit a notice of intent to the BRBevidencing its intent to annex the AH Annexation Area.

(g) Following BRB approval of Airway Heights' annexation of the AHAnnexatIon Area, the Airway Heights City Council will adopt a r'esolutionconcurring with Spokane's De-Annexation Resolution. Airway Heights willprovide notice of the public hearing at which it will. consider said resolutionconsistent with the requirements'of RCW 35.10.217(2).

(h) If necessary, Spokane adopts de-annexation ordinance for AHAnnexation Area; Airway Heights adopts ordinance providing forannexation of AH Annexation Area.

5. NEW SECTION. A new Section E is added to the MOU 8S follows:

E. Upon the parties mutual execution of the Inter10cal Agreement.contemplated by this MQU, SpokHne will dismiss its petition for reviewfiled with the Eastern Washington Growth Management Hearings Board(EWGMHB) relative to Airway Heights' adoption of Ordinance No. C-695and related SEPA determinations ("Spokane Petition")- Upon filing of thoSpokane Petition, Spokane Shall immediately move to stay all proceedings

IIIIIIIIIf

Pnge40fS

------'- ,,- - ---••

before the EWGMHB including the prehearing conference, statement ofissues. and preparation of the record to avoid time. expense andunnecessary distraction from the matters set forth herein.

CITY OF SPOKANE

Attest:

LL·Clerk

Attest:

Clerk

By: fY1 A:::J 8. \L~ .....Its: rn oIL'i l> r _ _ _

Approved as to form:

ASifstant City Attorney

CITY OF AIRWAY HEIGHTS

By: ~r-k=Its:~

Approved as to form:

The undersigned agree to place this First Amendment on the March 2, 20ng agendas oftheir respective city councils for ratification on that date and further agree to exercisebest efforts to obtain said ratification.

CITY OF SPOKANE

By: ......,./h~.;:.,::."""':;:::.. llo...~.sr.'!..l.'''';:\l>,..j/LAl£~'''~:(.+'!=~__

Its: --l'~U1I1.~"~'i'4-o~CL..- ~

CITY OF AIRWAY HEIGHTS

Page50f5

---------_._--

Submitting DeRt.Public Works

.1.mAnu IEISI.• Contracto Rltporto Claims

RECEIIIEQr...."",ABEIIII SHEh fOR COUIICIL MEnlNG Of: M8111,2009 CIT MAY 07 2009 .~

YCLERK' ,councll~ i:t'CE: 'k~:"l:!Contact Person/PhoO! No.

H. Deianey/J .Richman 625-6225

lUIIII11II-. 1m '1I11mo Emergency O«l 0 Cemmunicatione CLERK'S f:ILE (Jp(l.t2.DQQ -001~a ResolutiOn • Economie Development RENEWSo Final Reading Om 0 Growth Manag~ml!lnt CROSS ReF

,-;;:':":":=:====:--1 0 Flret Reading Ord 0 Human Serv!ees ENGSTANDING COMMITTeES 0 Special Con&idvralion • Noignborhoods BID

(Dale of Notification) 0 He. 0 PUb"e Safely REQUISl'rlONo FInance 0 Pub!lC S*y 0 Qua.ty Stil'Viee Delivery NelghborhoodfCommla;MnlCCIMIltlee NOUlled:oNelgl1llortlatJds......-:---- 0 Pli;Jlk:WorkII 0 Ractal Equity/Cultural Diversityo Pia . It & Econ Dev 0 RebulldfMalnlain InfrastrUdUIlI I.oA~.t.::!!,llon~·WT..!J.kert~: ...J

A8IJIU••UlN8: SECOND AMENDMENT OF MOU WITH THE CiTY OF AIRWAY HEIGHTS REGARDING

ANNEXATION ON THE WEST PLAINS

IACIIRIIIII:(Allltch lIclllltlonal&heel it ll8C8ssery)

Spokane County has designated the urban Growth Area adjacent to Airway Heights asa Joint Planning Area (JPA) between spokane, Airway Heights, and Spokane County.This JPA lies within Spokane'S water and sewer service areas and Spokane hasextended both water and sewer service to the JPA In exchange for property owners'commitments to annex Into Spokane. SpDkane has collectt!d annexation covenantsencompassing approximately 95 % of lheasaessedvalueof land lying within the JPA.Both Spokane and Airway Heights have bee-n exploring the feasibility of annexing theJPA, and both believe that mutual cooperation regarding armexatlonof the lPA is inthe best Interests of the citizens of both Jurisdictions and of those reSiding andconducting bUsiness Within the JPA and wish to enter into the attaChed Memorandumof Understanding, which contemplates a subsequent Intertocal Agreement underChapter 39.34 RCW to address annexations by both parties within the 3PA and tofurther address the financial impacts of such annQxl!IItlon.

RECIMMENDATION: Approve. ~FIIc:'=;:;=":"::"::lIU~tCl:::..· "':.....Nl_~ .......;:BU=d:::I.:::Il;.,:;Ac=::.I=D~.:::I:=--O_N_/A --1o Expenditure: $ #o Revenue: $ #o Budaet Neutral

anAC.MEITS: InclUde In Packets: MOU & Exhibits

IIIDI.UUII: Legal - Richman

Finance

Council President

PW&U - Thacker

------,--- --

SECOND AMENDMENT OFMEMORANDUM OF UNDERSTANDING

This Second Amendment is entered Into this~ day of May, 2009, by andbetween the City of Spokane, a first class charter city of the State of Washington("Spokane") and the City of Airway Heights, a non-charter code city of the State ofWashington ("Airway Heights"). jointly referred to a5 "parties",

Whereas, on January 20, 2009, the parties entered into a Memorandum ofUnderstanding agreeing to negotiate and approve an interlocal agreement for joint

, planning within and annexation and d&-annexation of urban growth areas lying betweenthe parties' corporate boundaries (the "MOU"); and

Whereas, on March 2, 2009, the parties executed a First Amendment of theMOU ("Finst Amendment">: and

Whereas, the MOU and First Amendment are collectively referred to in thisSecond Amendment as the "MOU·.

Whereas, the parties wish to amend the MOU all as more particularly set forth inthis second Amendment;

NOW THEREFORE. the parties agree as follows:

1. MQU. The MOU and any previous amendments and/orextensions/renewals, thereto, are incorporated by reference into this document asthough written in full and shall remain in full force and effect except as provided herein.

2. AMENDMENT OF SUBSECTION C(1). Section C(1) of the MOU isamended to extend the Stand Still Period from May 11. 2009 to July 13,2009.

3. AMENDMENT OF SECTION ECS)(c). Section E(8)(c) of the MOU isamended to extend the deadline for approval of the Interlocal Agreement by both partiesuntil July 13, 2009.

4. AMENDMENT OF SECTION E{B)(g). Section E(8){d) of the MOU isamended to provide that Spokane will commence annexation of the West PlainsAnnexation In Summer 2009.

CITY OF SPOKANE

Page I of2

-------_ --_ .

Attest:

~~~~~~Clerk

Approved as to form:

Assistant City Attorney

CllY OF AIRWAY HEIGHTS

By: ..).ru\ff1!--------­Its: ~. Ifwc. , .......

Attest:

Clerk

'", J ..

The undersigned agree to place this First ndment on the May 11, 2009 agendas oftheir respective city councils for ratifioatlon on that date and further agree to exercisebest efforts to obtain said ratification.

CITY OF SPOKANE CITY OF AIRWAY HEIGHTS

Thomas E. Danek. okCity AdmlnlstrlltOtCity of Spokane

By: --L--:::.:.J.,....::::::..-~...:....~ -­:sJ~~

Its:--------------

Page 2 of2

Submllting Dect.Public Woft<s

lDIJIIIlunn SUIIU• Contrllcto RlIl)Orto Claims

AIENDA SHED 'IR el.ICll MEml1 ••:Iulv 11. 2809Contact PeJlQnJPhone No.H. ~laney/J .Rlehm,n 625-6225

UB.SWIII SlSSIN em MIllYII t:rneryency Ord 0 CommuniCfltions CLt:RK'S FilE ()f(L. ?a:tl -001 bo Resolution • Economic Development RENEWSo Final Reading Ord 0 Growth M,nllgemenl CROSS REF

~==~~=="....., 0 First Reading Ord 0 Humin Servicee ENGo SPedill Conoideration 8 NelghborhoOd& RID _ ...._ ........__-_

o I14ta 0 Public Safely ~R~f:;:Q~U~IS~IT~IO;N~____:'~~~~~~"l"""_o PublIc Safety__ 0 auallty Servloe Dllliv.,y INeighbDl'hoodICommi..loIVCOmII'Ilt188 No1llled:°PlbIcW<Jl1l$ 0 RacIal Equity/Cultural Diversity

& !con Dell 0 RebulkllMalntllln Infrastructure I.-!A<:I/o~~n..:.To:::k:::!etI~; _

AUNDAWIIDII.: THIRD AMENDMENT Of MOU WITH THE CITY Of AIRWAY HEIGHrS REGARDING

ANNEXATION ON THE WEST PLAINS

IMUIIINI:(AttaCh additionalsheet if necessarY)

Spokane County has designated the Urban Growth Area adjacent to Airway Heights asa Joint Planning Area (JPA) between Spokane, Airway Heights, and Spokane county.This JPA lies Within Spokane's water and sewer service areas and Spokane hasextended both water and sewer service to the JPA In exchange for property owners'commitments to annex Into Spokane. Spokane has collected annexation covenantsencompassing apprOXimately 95 % of the assed value of land lyIng within the JPA.Both Spokane and Alrw"y Heights have been exploring the feasibility of annexing theJPA, and both believe that mutual cooperation regarding annexation of the JPA is inthe best interests of the citizens of both jurisdictions and of those residing andconducting business within the JPAand Wish to enter Into the attached Memorandumof Understanding, which contemplates a subsequent Interlocal Agreement underChapter 39.34 RCW to address ~nnexalions by both parties within the JPA and tofurther address the financial Impacts of such elOnexatlon.

IECDUENIAII,N: Approve. ~1II~~I:="::::· ~.::I:~•...;N_/A ...;';=-=..:::kc:::··::IID=:I:::...-O:;.;,NJ.:.:.'A.:.-__-fo ExpenditUre: $ #o Revenue: $ #o Bud t Neutral

An.C.llm: Include in Packets: MOU & Exhiblt$

SlllaTIBES:

ti§al

IISIRllmll: Legal - Rlchrnan

~l.- h4-.-.r~Division Director

Forthe~:""----­PW&U ~ Mercer

~lCouncit President

PW&U - Thacker

III1Dll ACnl.:APPROVED 9YANE CITY COUNCIL:

00

J I

THIRD AMENDMENT OFMEMORANDUM OF UNDERSTANDING '

o?R 0:0;·00\6This Third Amendment Is entered into this 9th day of July, 2009, by and between

the City of Spokane, a first class charter city of the State of Washington C'Spokane")and the City of Airway Heights, a non-eharter code city of the State of Washington("Airway Heights"), jointly referred to as "parties".

Whereas, on January 20, 2009, the parties entered into a Memorandum ofUnderstanding agreeing to negotiate and approve an interlocal agreement for jointplanning within and annexation and de-annexation of urban growth areas lying betweenthe parties' corporate boundaries (the "MOU"); and

Whereas, on March 2, 2009, the parties executed a First Amendment of theMOU (~Flrst Amendment"); and

Whereas, the parties thereafter executed a Second Amendment of the MOU("Second Amendmenr); and

Whereas, the MOU, the First Amendment, and the Second Amendment arecollectively referred to in this Third Amendment as the "MOU~.

Whereas, the parties wish to amend the MOU all as more partiCUlarly set forth inthis Third Amendment;

NOW THEREFORE, the parties agree as follows:

1, MOU. The MOU and any previous amendments and/orextensions/renewals, thereto, are incorporated by reference into this document asthough written in full and shall remain in fUll force and effect except as provided herein.

2. AMENpMENT OF SUBSECTION C(1). Section C(1) of the MOU Isamended to extend the Stand Still Period from July 13, 2009 to September 14, 2009.

3. AMENDMENT OF SECTiON E(8)(C). Section E(8)(c) of the MOU Isamended to extend the deadline for approval of the Interlocal Agreement by both partiesuntil September 14, 2009.

4. AMENDMENT OF SECTiON E(8)ldl. Section E(8)(d) of the MOU isamended to provide that Spokane will commence annexation of the West PlainsAnnexation in Fall 2009.

CITY OF SPOKANE

Pll8l: 1of2

Attest:

CllY OF AIRWAY HEIGHTS

BY:~~~. Its: Ji;1tL.e~-----------

Approved as to fonn:

~cZ~ ~~Clerk . Crr1ey- ~

The undersigned agree to place this~~endment on the u~v i 4, 2999 agendas oftheir respedlve city councils for ratification on that date and further agree to exercisebest efforts to obtain said ratification.

CITY OF SPOKANE CITY OF AIRWAY HEIGHTS

By:Its: ---"-I:JIE'-.e:--------

Page 2 of2

IIIIIIJIUIIIIIIIIH• COl1ll'lleto Reporto Claims

lIIIlIItIIf .EIf. em PlIIIIIJo Emergency Ord u Communications CLERK'S FILEo Re.olutkm • Economic: Development RENEWSo Fln.1 Relldlng Ord 0 Growth Mllnllgem8nl CROS$ REf

~='::':'!'!====".-,0 Firat Reading Ord 0 Human Services ENGo Sp8cUll COnllderstlon • Neighborhoods BIDo Helrln u Public Safely ~R~EQU~IS~IT.!,!ION~_.....,..~~ __,!,!,""~~

'"Q:::P:o:.:ub~1lG::';.satelY:ill.~::::::=...., a Quality serviCe Delivery [NelahbOrhtloclfCommiSSiOnIC.oMmittoe NoIlfied.:-

L;ij~;!r;~i]~~O~PubIc~·:Wi=l)j!(S::-:--=-=-=-=-J 0Raele' EqultylCullural Diversity -&Econ DeY 0 RebUUdlMalntaln Infralilrucl.urs .cAfA~ion=.!-T~ake~n·,-, _

IIElDA.RIINI: FOURTH AMENDMENt OF MOU WITH THE CITY OF AIRWAY HEIGHTS RI;:GARDING

ANNExATiON ON THE WEST PLAINS

IlcaRI.I:(Altech additionalsheet if neoe$lllry)

Spokane County has designated the Urban Growth Area adjacent to Alrw~y Heights asa Joint Planning Area (lPA) between Spokane, AIrway Heights, and spobne County.ThiS JPA lies within Spokane's water and sewer service areas and Spokane hasextended both water and sewer service to the JPA In exchange for property owners'commitments to annex Into spOkane. Both Spokane and Airway Heights believe thatmutual cooper~tjon regilrdlng annexation of the lPA is in the best Interests of thecitizens of both jurisdictions and of those residing and conducting business within theJPA and previously entered Into a Memor12ndum of Understanding (MOU) outlining theparties' intention to work towards an agreement that wHl applV to the annexation. Theparties have preViously extended the MOU three times and now wish to extend theMOU for a fourth time.

RElDIMENlAnON: Approve.

IUUlMEIlS: Include in Packets;

1111IAnRES:

e"I.AI1JIt

CITY CL

"A1T1GBcowa.CTION~';K1""'CATID: c;!?o!O't. I~

()PR. ~Do9-00I{'

FOURTH AMENDMENT OFMEMORANDUM OF UNDERSTANDING

~ Ddtb<tv. This Fourth Amendment is entered into this _5__ day of Saptefnber, 2009, by

and between the City of Spokane, a first class charter city of the state of Washington("Spokane") and the City of Airway Heights, a non-charter code city of the State ofWashington ("Airway Heights'1, jointly referred to as "parties".

Whereas, on January 20, 2009. the parties entered into a Memorandum ofUnderstanding agreeing to negotiate and approve an interlocal agreement for jointplanning within and annexation and de-annexation of urban growth areas lying betweenthe parties' corporate bOundaries (the IIMOU"); and

Whereas, the parties thereafter executed three amendments of the MOU, eachamendment being for the purpose of extending the stand still provisions of the MOUrAmendmentsn

); and

Whereas, the MOU and Amendments are collectively referred to in this FourthAmendment as the "Moun; and ..

Whereas, the parties wish to amend the MOU all as more particularly set forth inthis Founh Amendment;

NOW THEREFORE, the parties agree 88 follows:

1. M.Q!J.. The MOU and Bny previous amendments and/orextensions/renewals, thereto, are inoorporated by reference Into this document a8though written In fuJi and shall remain in full force and effect except 8S provided herein.

2. AMENDMENT OF SUBSECTION Cli). Section C(i) 01 the MOU Isamended to extend the SIand Still Period from September 14, 2009 to October 14.2009,

3. AMENPMENT Of SECTION E{S)(ql. Section E(S)(c) of the MOU 1$amended to extend the deadline for approval of the Interfocal Agreement by both partiesuntiIOcwberi4,2009.

4. AMENDMENT OF SECTION E(8)(d). Section E(S)(d) of the MOU Isamended to provide that Spokane will commence annexation of the West PlainsAnnexation in Winter 2009.

Page 1of2

J

-.) .,

Attest:

Clerk

Attest:

CITY OF SPOKANE

By: ~--~Its. CItYMln_alUt

Approved as tocr&.'lh~

~k.sRAssistant City Attorney

CITY OF AIRWAY HEIGHTS

By:,,~~~Its: C~ t!».*'y"

Approved as to form:

The undersigned agree to place this Fourth Amendment on the agendas of theirrespective city councils no later than September 22, 2009 for ratification on that dateand further agree to exercise best efforts to obtain said ratification.

CITY OF SPOKANE

BY:~6,v~Its: ..=.:.:.E~_8¥V1p",,"---- _

CITY OF AIRWAY HEIGHTS

PSio2of2

Page 13 of 14

Exhibit B

Map of Annexation Area

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Legend

~ Spol<ane Annexation Area

: i Fire District 10 Inside the Area

! ' 'I Fire District 3 Inskle the Area

jN

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Exhibit BSpokane Annexation Area

1 inch = 3,500 feet~1J_2011 By B.*.F1

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West Plains Annexation Area

Legend

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Exhibit C

Interlocal Agreement Between the City of Spokane and Spokane County Fire ProtectionDistrict No.3 Concerning Impacts of Annexation, dated May 10, 2010

Page 14 of 14

,.OJ I!'" N

Neighborhood/Commission/Committee Notified:

CLERK'S FILERENEWSCROSS REFENGBIDREQUISITION

Submitting Dept.Capital Programs

A;C~/II~D fE.252OOB

IIElDI SlEET FBI 08UICI1 MEmI. 8F: Mil 10. 2010 CITyc 'R 29 20fObNEBtJ LC!:?Jf'

Contact person/Phone No. Council s-ao@4tRtvf' Of::f::/CJohn Mercer/625-<1065 Public Works Comrnitf6cl\ I!

1lWlJlJllllll1UII-• Contracto Reporto Claims

UIISlIDII SISSIII em P.1I11lYo Emergency Ord 0 Communicationso Resolution 0 Economic Developmento Final Reading Ord X Growth Managemento First Reading On:l 0 Human services

r-=:=~~===~ 0 Special COnsideration 0 Neighborfloodso Heari 0 Public Safety

L.,;O:::-PU""i'b~liC~S~afe~ty~-:: -~-~-~-_..., 0 Quality Service Delivery• Public Works .olJ2&'10 0 Racial Equity/Cultural Diveillity

L.::.':..::::.~~~~~&~Eco=.:.n.:::De=.::v"- --, • RebuildIMaintain Infrastructure L..:A~ct~lo::::.n:..:T.=:ak~e~n: -..I

• 1••......:(If contract, InclUdethe term.)

Intel10cal Agreement between the City of Spokane and Spokane County Fire Protection District No.3 concerning mitigation of annexation impacts.

1AC11I111D:(Attach additkmalsheet if necessary)

In 1999, the City and Fire District 3 (FD 3) entered Into a Fire and Emergency Medical ProtectionService Area Agreement which provides for, among other things, good faith negotiations betweenthe parties in the event the City wished to annex portions of the area served by FD 3. The City isnow working on the West Plains Annexation, a small portion of which is currently served by FD 3.Additional land currently served by FD 3 is also located within the City's Urban Growth Area whichthe City may wish to annex in the future. During 2009 and 2010, the City and FD 3 negotiated anInterlocal Agreement concerning Impacts of annexation. This Agreement will replace the 1999document and apply to a/l future annexations of land served by FD 3. The Agreement wasapproved by FD 3 Commissioners on April 14, 2010.

1IIII-lllAnal:Approve

aBACIMEIIS: Include In Packets:On file for Review In Office of City Clerk:

R.I••". 0 NJAo Expenditure: $o Revenue: $o Budget Neutral

Interlocal Agreement, Map

Bld.,llcco.1I: 0 N/A

##

Agenda\lnterlocal agmt FD3

legal

Chief Bruce HollowaySFPO No.310 S. Presley Dr.Cheney, WA 99004

Accounting

Council President

Utilities, 0 MandykeCapital Programs. J MercerFire, B Williams

IIIDII.ITIDII:

~.

eJ.(!k~~aPital P:-rog-ra-m-s---

,>-Ia-° ,

CI••CO ICnlll:

APPROVED BYSPOKANE CITY COUNCIL:LJj~ 10 d()IO

INTERLOCAL AGREEMENT BETWEEN THE CITY OF S)lOKANEAND SPOKANE COUNTY FIRE PROTECTION IHSTRICT NO.3

CONCERNING IMPACTS OF ANNEXATION ~!)'4

cP\e o.:»O-Q..:ovTHIS AGREEMENT is made and executed this I '-I day of A f(<-I 1--:.._

___, 2010 ("EtIective Date"), by and between the CITY OF SPOKANE, a municipalcorporation of the State of Washington, (hereinafter the "City") and SPOKANE COUNTY fiREPROTECTION DISTRICT NO.3, a municipal corporation of the State of Washington,(hereinafter the "District"), pursuant to the lntcrlocal Coopcration Act, RCW 39.34.

RECITALS

A. The District is a special purpose district established pursuant to Chapter 52.02 ft.)( theprovision of fire prevention services, fire suppression services, emergency medicalservices, and for the protection of We and property in ccrtain unincorporated arcas ofSpokane County.

B. The City and the District currently maintain and operate their own tire departments toprovide tire protection, fire suppression and emergency medical services in theirrespective jurisdictions.

C. Consistent with Chapter 36.70A RCW, Spokane County previously adopted urbangrowth arcas, which include the City and certain unincorporated areas of SpokaneCounty contiguous to the City, including portions of Spokane Counly currently servedby the District.

D. Thc Growth Management Act encourages citics with urban services to annexunincorporated urban areas within a County.

E. The parties previously executed a rire and Emergency Medical Protection Service AreaAgreement, which agreement was signed by the District on 5/12/99 and by the City on8/22/99 providing for, among other things, certain notice requirements and good faithnegotiations between the parties in the event the City wished to annex portions of thearea served by the District (the I999 Agreement).

~'. The City and District believe that mutual cooperation with respect to annexations is inthe best interests of the citiLens of both jurisdictions and wish to enter into an annexationimpact agreement, under the authority of Chapter 39.34 (the Interlocal Cooperation Act),to be applied to all possible future annexations by the City within the District to addressthe impact of such annexations on the provision offire protection, fire suppression andemergency medical services to the residents of the District inside and olltside of anyfuture annexation areas.

AGREEMENT

NOW, THEREFORE, in consideration of the facts set forth hereinabove, the City and theDislrid hereby agree as follows:

1. I)URPOSE. The purpose ofthis Agreement is to establish certain agreements between theCity and the District relating to the City's annexation of areas ofthc District in which the Districtpresently provides fire protection and emergency medical services.

2. APPLICABILITY OF THIS AGREEMENT. Upon the effective date of this Agreement,the 1999 Agreement shal1 terminate and be of no further effect. The City and the District agreethat the provisions of this Agreement shall apply to all future annexations by the City of areaswithin the City's urban growth areas that are also located within the boundaries of the District.

3. PROVISION OF FIRE PROTECTION AND EMERGENCY SERVICES.

3.1. The District will continue to provide fire protection, Lire suppression, andemergency medical services to those areas of the District situated outside of the City'scorporate boundaries, as adjusted from time to time by annexation(s),

3.2. Upon the effective date of future aJIDexations by the City within the District, thcareas so annexed by the City shall be automatically removed from the jurisdiction of thcDistrict and the City shall be rcsponsible for providing fire protection and emergency serviceswithin the areas so annexed by the City.

3.3. At the City's option and, except as providcd in paragraph 4,3, without additionalcost to the City, the District will continue to provide service, at least at thc same level as beingprovided at the time of the annexation, to the area(s) of the District annexed by the City, Suchservice delivery by the District will continue until all compensation for lost revenue, asoutlined below, is complctcd by the City or until the City determines to discontinue thecoverage. Upon completion of the compensation payments, the City may, at its discretion.request the District to continue to scrve the annexation arca(s) for additional compensation tobe negotiated at the time of the re4uest.

4. COMPENSATION FOR LOST REVENUE.

4.1. Compcnsation Formula for Future Annexations, Subject to the terms of thisAgreement, the City agrees to compensate the District lor property tax revenues that will belost by the District as a result of future alUlexations by the City within the District. Withrespect to cach such future annexation by the City, such compensation shall be based on thefollowing formula:

AV x DLR x 6,51,000

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AV = Assessed Value of real property lying within boundaries of the subjectfuture annexation, as of the date the subject annexation is effective.

DLR 0"" District levy rate in effect as of the effective date of the particularannexation.

4.2. Payment Schedule re Compensation for Future Annexations. Compensation for 'future annexations shall be payable by the City to \he District in six equal annual installments,without interest, except the sixth payment shall be for one and one half the annual installment.With respect to each such future annexation, the first payment tram the City to the Districtshall be due and payable on the 1SI day of December of the year the City receives its firstproperty tax disbursement, after annexation, for the subject property. Subsequent paymentsshall be due and payable on the 1SI day of December in the second, third. fourth, fifth and sixthyear the City receives property tax disbursements for the subject property. At its discretion. theCity may accelerate payments to meet its obligation in a faster timeframe. It is agreed that uponcompletion of payments as scheduled in this Section 4, each party will have been fairly. fully.and adequately compensated for their respective annexation impacts relative to such futureannexations.

4.3. Payment Adjustments if District Continues to Provide Service. In the event theDistrict continues to provide services to the annexation area pursuant to paragraph 3.3 thecompensiition amount shall be adjusted each year after the first year by the limit factor used bythe District to establish its regular property tax levy for the year the payment is made. Inaddition, during such period of continued service, the City shall pay to the District the amountof Leasehold Excise Taxes the District would have received had the annexation not occurred.

5. DISTRICT EMPLOYEES. In the event annexation(s) by the City of any territory coveredby this Agreement triggers statutory requirements concerning employment of District cmployeesthat arc terminated as a direct consequence of the aImexation, any such employee may transfer tothe City'S civil service system if he or she can perform the duties and meet the minimumqualifications of the position to be filled. Such transfer is SUbject Lo the requirements andlimitations in RCW 35.13.225 and .235, the terms of which, as amended from time to time, arcincorporated into this Agreement.

6. TRANSFER OF DISTRICT ASSETS. As additional consideration for the District'scovenants and agreements hereunder. the City agrees to and docs bercby waive its rights to adistribution of assets from the District to the City with respect to any annexation by the Citysubject to the terms of this Agreement.

7. CUMULATIVE Eltfi'ECT OF ANNfi:XATIONS. 'rhc Parties agree that the percentage ofthe assessed v,llue of the District contained in each aIUlexation may be cumulated for allannexations which occur during the term of this Agreement for purposes of determining when60% of the District's assessed valuation has been annexed. Par the purpose of detem1ining whenthe 60% threshold is met, the base valuation of the total District will be calculated as the totalvaluation of the District as of the effective date of this agreement (the "base valuation"). Annual

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adjustments will be made to the base valuation as a result of re-evaluations by the SpokaneCounty Assessor Office, new construction and reductions as a result of the annexation of Districtarea by other cities or tire districts. Once the 60% threshold has been reached pursuant to thisSection 7. either or both Pal1ies may invoke the provisions of RCW 35.02.190.

8. EARLY NOTICE AND COLLABORATION. The City agrees that it shall provide theDistrict written notice for any proposed annexation of District areas at least 28 calendar daysprior to action by the City Council on a request to initiate annexation.

9. Provided that the City is in substantial compliance with the provisions of this Agreement,the District will not oppose the City's right to annex an:as of the District that lie within the City'sUrban Growth Area.

10. Provided that the City is in substantial compliance with the provisions of this Agreementand provided that the City has complied with the Notice requirement in Paragraph 8, the District,at the City's request, will in a timely manner, agree to participate in negotiations with the Cityand County on the Annexation by ordinance method established in Secti011 7 of ESSB 5808,Chapter 60 Laws of 2009.

II. RECOH.DS TIl.ANSFER. Cit)' staff will copy necessary District records prior to andfollowing annexations as necessary. District records to be copied will include, but not be limitedto, lire inspection reports and records, bonds, and other items identified during the annexationprocess. The City will reimburse the District for the costs of any District materials necessary forduplication or transfer, including microfilming. The City may arrange for otJ-site duplication ofrecords under appropriate safeguards for the protection of record as approved by the District.

12. ADMINISTRATION. The City of Spokane Director of Public Works and UtilitiesDepartment and the District Fire Chief~ respectively, arc jointly designated as responsible lorimplementing this Agreement.

13. TERMINATION. This Agreement may be terminatcd any timc by the mutual writtenconsent of the City and the District. If the City and/or the District terminates this Agrecmentpursuant to this Section, all rights and obligations of the City and District under this Agreementshall terminate without liability of onc party to the other, provided, however, that any obligationthat the City has incurred to the District under Section 4 above shall survive thc termination.

14. I~VENTS OF DEFAULT. It shall be an "Event of Default" under this Agrecment if eitherthe City or the District fails duly to pcrform, observe or comply with the coven,lnls, agreements,or conditions on its part contained in this Agreement, and such default shall continue for a periodof thirty (30) days after written notice of such litilurc. requesting the same to be remedied. shallhave been given to the party in default by the non-defaulting party, provided however that suchfailure shall not be an Event of Dcfault if it is knowingly and intentionally waivcd by the non­defaulting party.

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15. REMEDIES. Upon the occurrence and continuance of any Event of Default, the nOI1­defaulting party's exclusive remedies shall be specific perfonnance, declaratory judgment andother equitable remedies, and recovery of attorney's fees and other costs for such enforcementaction.

16. NOTICE. Notice shall be given in writing as follows:

To the City:Title:

Address:

DirectorPublic Works & Utilities Department808 W Spokane Falls BlvdSpokane, WA 99201

To the District:Title:Address:

Fire Chiefto S. Presley Dr.Cheney, WA 99004

17. RELATIONSHIP TO EXISTING LAWS AND STATUTES. Except as provided inSections 6, 7, 8,9 and 10 above, this Agreement in no way modifies or supersedes existing lawsand statutes. By executing this agreement, the City and District do not purport to abrogate thedecision·making responsibility vested in them by law.

18. INDEMNIFICATION AND HOLD HAR~LESS. Each party shall indemnify and holdthe other. its officers, employees, agents and volunteers harmless from and against any <md allclaims, demands, orders, decrees, judgments for injuries, death or damage to any person orproperty arising or resulting from any act or omission on the part of said party or its agents,employees or volunteers in the performance of this Agreement.

19. DISPUTE RESOLUTION. All disputes arising out of this Agreement shall be determinedby lhe Superior Court of the State of Washington, with venue located in Spokane County,Washington. The substantially prevailing party in any arbitration or litigation shall be entitled torecover from the substantially non.prevailing party its reasonable attorney fees and otherarbitration or litigation costs.

20. REPRESENTATIONS AND WARRANTIES OF THE CITY. The City represents andwarrants to the District that the statements contained in this Section are correct and complete asof the Ellective Date, and shall continue in full force and efTect after such Effective Dateregardless of what investigations the District may have made with respect to the subject matterthereof: The City acknowledges that the statements contained in this Section are material and arerelied upon by the District.

20.1. Organization. The City is a first~class charter city, duly organized and validlyexisting under and by virtue of the constitution and laws of the State, and the Charter of theCity.

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20.2. Binding Effect. The City has full power and authority to exel:ute and deliver thisAgreement, and to perform the City's obligations under this Agreement. This Agreementconstitutes the valid and legally binding obligation of the City and is enforl:eable in accordance·with its provisions.

20.3. Authority of Signatories. All individuals executing this Agreemcnt on behalf ofthe City have the requisite power and authority to do so.

21. REPRESENTATIONS AND WARRANTIES OF THE DISTRICT. The Districtrepresents and warrants to the City that the statements contained in this Section are correct andcompletc as of the Effective Date and shall continue in full force and effect alter such Effective.Date regardless of what investigations the City may have made with respect to thc subject matterthereof. The District acknowledges that the statements contained in this Section are material andare relied upon by the City.

21.1. Organization. The District is a municipal corporation, duly organized andvalidly existing under and by virtue of the Constitution and laws of the State.

21.2. Binding Effect. The District has full power and authority to execute and deliverthis Agreement, and to perform the District's obligations under this Agreemenl. ThisAgreement constitutes the valid and legally binding obligation of the District and isenforceable in accordance with its provisions.

21.3. Authority of Signatories. All individuals executing this Agreement on behalf ofthe District have the requisite power and authority to do so.

22. ENTIRE AGREEMENT. This written Agreement constitutes the entire and completeagreement between the City and the District with respect to all future annexations by the Citywithin the District as defined herein. This Agreement may not be changed, modificd or alteredexcept in writing signed by the City and the District.

23. EI<'fi'ECTIVE DATE, DURATION AND TERMINATION. This Agreement shall beeffective upon the Effective Date and shall remain in full force and effect until terminated byboth the City and District. Any amendments and termination shall be in writing and executed inthe same manner as provided by law lbr the execution of this Agreement.

24. SEVERABILITY. If any provision of this Agreement or its application to any person orcircumstance is held invalid, the remainder of the provisions and/or application of the provisionsto other persons or circumstances shall not be affected.

25. TIME OF THE ESSENCE. Time is of the essence ofthi8 Agreement.

26. nLiNG ANI> RECORDING. This Agreement shall be filed and/or recorded by theDistrict at its expense with the Spokane County, Washington, Auditor, and/or with such othermunicipality or other public agenl:Y located in the State of Washington as such party deemsappropriate.

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27. NO TI-lIRD~PARTY BENEFICIARIES This Agreement shall not confer any rights orremedies upon any person other than the City and the District and their respective successors andpermitted assigns.

28. NO WAIVER. The failure to enforce or the delay in enforcement of any provision of thisAgreement by a party hereto, or the failure of a party to exercise any right hereunder, shall not beconstrued to be a waiver of such provision or right (or of any other provision or right hereof,whether of a similar or dissimilar nature) unless such party expressly waives such provision orright in writing.

29. SUCCESSORS AND ASSIGNS. This Agreement and each and every provision hereofshall be binding upon and shall inure to the benefit of each party hereto, and each and every oftheir respective successors and permittcd assigns. No party's right or obligations under thisAgrcement may be assigned or otherwise transferred without the prior written consent of theother party.

30. SEVERABILITY. In the event ofa determination by any court of competent jurisdiction thata portion or this Agreement is invalid or unenforceable, such portion shall be deemed modified oreliminated in accordance with the court's order and the remaining portions of this Agreement shallnonetheless be enforced; provided, however, that if the court deems any restriction on the disclosureof infomlation to be unenforceable, such restriction shall be modified by thc court only to the extentrequired to make such restriction reasonable and enforceable.

31. RECITALS AND ATTACHMENTS. "l'he recitals contained at the beginning of thisAgreement, and the Attachments attached to this Agreement, arc material parts of thisAgreement and are incorporated herein by this reference.

32. SEPARATE LEGAL ENTITY This Agreement does not create or seck to create aseparate legal entity pursuant to RCW 39.34.030.

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33. NEGOTIATION AND CONSTRUCTION. This Agreement and each of its tenns andprovisions are deemed to have been explicitly negotiated between the parties, and the language .in all parts of this Agreement wiH, in all cases, be construed according to its fair meaning and notstrictly for or against either party.

ACCEPTED AND AGREED as of the Effective Date.

CITY OF SPOKANE

By: ~ ~. )--~--~

City Administrator

Attest: ,I~'~X~

CityC~

Approved as to form:

SPOKANE COUNTY FIRE PROTECTION'DISTRICT NO.3

BYCl'kuu~·CommissIOner

By~2n¥~Commissioner

By: lli\.J.Ac. ~ ~ Q ~t.-OSecretary

City Attorney

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